Vuosikertomus 2019 Taloudellinen katsaus
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Contents
Solteq in Brief
3
CEO’s Review
5
Corporate Governance Statement
6
Remuneration Report
19
Report of the Board of Directors
23
Key Figures
36
Financial Statements
41
Auditor’s Report
102
Statement of Non-Financial Information
109
This is a voluntary prepared translation of the ESEF report, so it does not fulfill the disclosure obligation pursuant to Section 7:5§ of
the Securities Markets Act.
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Solteq in Brief
Solteq provides software solutions and IT expert services to the energy sector,
retail industry, and the needs related to e-commerce. The Company employs over
650 professionals and serves its customers in the Nordic countries. The company
has offices in Finland, Sweden, Norway, Denmark, Poland, and the UK.
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“The updated strategy, the new management,
and investments in internationalization will create
a path toward profitable growth in the near future.”
CEO Aarne Aktan
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The profitability weakened due to a decrease in demand and
difficulties in product development
The year 2022 was tough for Solteq. The Group’s revenue was EUR 68.4 million (69.1) for the financial year,
staying flat relative to the comparison period. The biggest change from the previous year was the Group’s
profitability. The comparable EBITDA was EUR 6.4 million (12.6) and the comparable operating result was
EUR 0.9 million (7.4).
The Russian invasion of Ukraine drove the global economy into uncertainty with high inflation and interest
rate levels. The uncertain operating environment reflected the demand in regard to the Solteq Digital
segment. The revenue of the segment was EUR 42.1 million (44.3). The decrease in demand affected the
profitability of the segment. The EBITDA was EUR 5.3 million (7.9) and the operating result was EUR 3.2
million (5.6).
The revenue of the Solteq Software segment increased and was EUR 26.3 million (24.8). Despite the
growth, the problems with the product development of the Utilities business continued since the beginning
of the year and weakened the profitability of the segment. The financial year’s comparable EBITDA was EUR
0.6 million (4.6) and the comparable operating result was EUR -2.8 million (1.8). The two acquisitions made
in 2022 aimed to strengthen the offering and market position of the Utilities business. In addition, the Solteq
Robotics business area, which had demanded significant product development investments, was
terminated for being unprofitable.
The market situation and the challenges related to the product development of Utilities continue to strain
the company during the financial year 2023.
Despite this, the outlook for the Retail & Commerce segment
is expected to remain moderate. The estimated outlook for the Utilities segment is good. The company
aims to resolve the product development problems during the first half of the year. The updated strategy,
the new management, and investments in internationalization will create a path toward profitable growth in
the near future.
Aarne Aktan
CEO
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Corporate Governance
Statement
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Investor Information
Annual General Meeting
The shareholders of Solteq Plc will be invited to the Annual General Meeting, which will be held at Hotel
Clarion Aviapolis in Vantaa (Karhumäentie 5) on Wednesday, March 29, 2023, at 10:00 a.m. The
Company’s shareholders can also participate online. The online participants can exercise their rights to
vote and to speak. The shareholders can also exercise their voting rights by voting in advance.
Solteq’s Financial Reporting in 2023
• Interim Report 1–3/2023 on May 4, 2023, at 8:00 a.m.
• Half-Year Financial Report 1–6/2023 on August 23, 2023, at 8:00 a.m.
• Interim Report 1–9/2023 on October 26, 2023, at 8:00 a.m.
Stock Exchange Bulletins 2022
Dec 30, 2022
Amendments to the terms and conditions of Solteq Plc notes approved in written procedure
Dec 19, 2022
Solteq Plc makes a clarification to the notice of written procedure relating to its EUR 23 million senior
unsecured fixed rate notes due 2024 and extends the voting deadline
Dec 12, 2022
Changes in Solteq Plc’s Executive Team
Nov 25, 2022
Solteq Plc announces a written procedure to amend the terms and conditions of its EUR 23 million
senior unsecured fixed rate notes due 2024
Nov 25, 2022
Solteq updates its strategy: the energy sector, retail industry, and e-commerce at the core of the
business
Nov 14, 2022
Solteq Plc - Managers' Transactions
Nov 11, 2022
Solteq Plc - Managers' Transactions
Nov 9, 2022
Changes in Solteq Plc’s Executive Team
Oct 27, 2022
Solteq Plc’s Financial Reporting and Annual General Meeting in 2023
Oct 27, 2022
Solteq Plc’s Interim Report January 1 – September 30, 2022
Sep 22, 2022
Solteq Plc - Managers' Transactions
Sep 22, 2022
Solteq Plc - Managers' Transactions
Sep 19, 2022
Kari Lehtosalo, CFO of Solteq Plc, appointed as EVP of the Solteq Software segment
Sep 19, 2022
Profit warning: Solteq Plc lowers its guidance for revenue and operating profit for 2022
Aug 30, 2022
Solteq Plc - Managers' Transactions
Aug 22, 2022
Solteq Plc - Managers' Transactions
Aug 18, 2022
Solteq Plc - Managers' Transactions
Aug 18, 2022
Solteq Plc - Managers' Transactions
Aug 17, 2022
Solteq Plc - Managers' Transactions
Aug 15, 2022
Solteq Plc - Managers' Transactions
Aug 11, 2022
Solteq Plc Half-Year Report January 1 – June 30, 2022
Aug 11, 2022
Solteq Plc: Change in the Audit Committee of the Board of Directors
May 25, 2022
Profit warning: Solteq Plc lowers its revenue and profit guidance for 2022
Apr 28, 2022
Solteq Plc’s Interim Report January 1 – March 31, 2022
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Apr 1, 2022
Aarne Aktan Appointed as CEO of Solteq Plc
Mar 24, 2022
Decisions of the Annual General Meeting 2022 and the Board meeting held after the Annual General
Meeting
Mar 2, 2022
Notice to Solteq Plc’s Annual General Meeting 2022
Mar 2, 2022
Solteq Plc’s Annual Report 2021 Has Been Published
Feb 25, 2022
Update on the recruitment process of Solteq Plc’s CEO
Feb 17, 2022
Solteq Plc’s Financial Statements Bulletin January 1 – December 31, 2021
Jan 14, 2022
Kari Lehtosalo appointed as Interim CEO of Solteq Plc
Corporate Governance Statement
Corporate Governance Statement has been drafted in compliance with the Finnish Companies Act and
the Finnish Securities Markets Act valid on the date of publication. The Statement is issued as a separate
report and a reference to this statement is made in the Report of the Board of Directors.
General Principles
Solteq Plc is a public limited company registered in Finland and its head office is in Vantaa. By the end of
the financial year, Solteq Group consists of the parent company Solteq Plc, two domestic subsidiaries,
and four foreign subsidiaries, which have four additional subsidiaries.
Decision-making and governance at Solteq comply with the Company’s Articles of Association, the
Finnish Companies Act and other applicable legislation. In addition, the Company complies with the
Securities Market Association’s Corporate Governance Code (Corporate Governance Code is available at
cgfinland.fi) as well as the Nasdaq Helsinki Ltd Guidelines for Insiders. The foreign subsidiaries comply
with local legislation.
Duties of the Governing Bodies
The Annual General Meeting of shareholders, the Board of Directors, and the CEO oversee the
management of Solteq Group and their tasks are determined in accordance with the Finnish Companies
Act. The CEO oversees group-level operative activity, assisted by the Group’s Executive Team.
Annual General Meeting
The Annual General Meeting is the highest governing body of the Company. The Annual General Meeting
is held once a year on a date determined by the Board of Directors, within six months of the end of the
financial year. Extraordinary Annual General Meetings may be held during the year, if necessary. In
accordance with the Articles of Association, Annual General Meetings are held in Vantaa, Finland, which
is where the Company’s registered head office is located. A notice to the Annual General Meeting of
shareholders and the agenda of the meeting are published in at least one Finnish national daily
newspaper and as a stock exchange bulletin as well as on the Company’s website.
The Annual General Meeting decides on the following matters:
• approval of the income statement and balance sheet,
• measures to be taken regarding the profit or loss shown on the approved balance sheet,
• discharging the members of the Board of Directors and the CEO from liability,
• number of Board members and their appointment,
• election of auditors,
• remuneration of the Board of Directors and auditors, and
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• other matters specified in the notice to the Annual General Meeting.
Shareholders have the right to propose a relevant issue to the Annual General Meeting agenda. Proposals
must be made in writing to the Board, before the Annual General Meeting, and by the deadline announced
on the Company’s website
Decisions of the Annual General Meeting are published in a stock exchange bulletin immediately after the
meeting. In addition, the minutes of the Annual General Meeting, including the appendixes and voting
results are made available to the shareholders on the Company’s website, within two weeks of the Annual
General Meeting.
Board of Directors
The Board of Directors of Solteq Plc is responsible for the Company’s management and the appropriate
organization of its operations. According to the Companies Act, the Board of Directors represents all
shareholders and has the general duty to act diligently in the interest of the Company. The Board of
Directors is responsible for the duties specified in the Articles of Association and the Finnish Companies
Act. The main duties of the Board of Directors include confirming the Company’s strategy and budget,
making decisions on financing agreements, and decisions on the purchase and sale of significant assets.
The Board of Directors monitors the Company’s financial performance by means of monthly reports and
other information provided to the Board by the Company’s management.
The duties and responsibilities of the Board of Directors are defined primarily by the Articles of
Association and the Finnish Companies Act. The Board of Directors annually ratifies a written charter that
specifies the meeting procedure of the Board of Directors and its duties.
In accordance with the charter, the duties of the Board of Directors are to:
• steer the Company’s operations in such a way as to maximize long-term added value to the assets
invested in the Company, while taking the Company’s various stakeholder groups into consideration,
• approve the incentive systems of the CEO and other management personnel,
• appoint and dismiss the CEO and decide on the terms of the CEO’s service contract,
• confirm the strategy, business objectives, and annual budget and supervise their implementation,
• approve significant financing agreements and the purchases and sales of significant assets,
• review and approve interim reports and financial statements,
• review and approve mergers, acquisitions, and corporate restructuring arrangements with a total value
exceeding EUR 500 thousand and exceptional balance sheet items of more than EUR 100 thousand that
are not part of the Company’s regular business operations,
• review all contracts, agreements, and business transactions with the owners of the Company and the
Executive Team with their related parties, and with companies in which Solteq Plc holds a controlling
interest,
• approve the Company’s structural changes and confirm the organization of the Company based on the
CEO’s proposal,
• appoint the members of the Company’s senior management who report to the CEO, based on the CEO’s
proposal, and decide on the remuneration principles of the members of the Executive Team,
• regularly assess its own operations and collaboration with the management, and
• deal with other matters that the Chairman of the Board and the CEO have agreed to be dealt with by the
Board of Directors or matters that are otherwise within the decision-making power of the Board of
Directors based on the Companies Act, other legislation, the Company’s Articles of Association and
other applicable rules and regulations.
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The special duties of the Chairman of the Board of Directors are to:
• steer the work of the Board of Directors in a manner that ensures that the Board attends to its duties as
efficiently and appropriately as possible,
• maintain regular contact with the CEO between Board meetings to monitor the operations of the
Company,
• if necessary, maintain regular contact with other Board members between Board meetings,
• if necessary, maintain regular contact with the Company’s shareholders and other stakeholders, and
• bear responsibility for the planning and assessment of the activities of the Board of Directors and the
assessment of the CEO.
In accordance with the Articles of Association, Solteq’s Board of Directors has a minimum of five and a
maximum of seven regular members. The Board members are elected by the Annual General Meeting for
one term of office at a time. The majority of the Board members should be independent of the Company.
In addition, at least two Board members who are independent of the Company should also be
independent of the significant shareholders of the Company.
The term of office begins at the end of Annual General Meeting that elects the Board of Directors and
expires at the end of the first Annual General Meeting following the election. The Articles of Association
place no restrictions on the power of the Annual General Meeting to elect members of the Board of
Directors. The Board of Directors elects a chairman from among its members and the Board of Directors
is deemed to have a quorum when more than half of its members are in attendance. In addition to matters
to be resolved, the Board of Directors is provided with up-to-date information on the Group’s operations,
financial standing, and risks in its meetings. The Board of Directors meets 10–14 times per year according
to an agreed schedule, in addition to which the Board of Directors is convened when necessary. Minutes
are kept for all meetings.
The Annual General Meeting 2022 elected six (6) members to Solteq’s Board of Directors. The Annual
General Meeting re-elected Aarne Aktan, Markku Pietilä, Panu Porkka, and Katarina Segerståhl, and Anni
Sarvaranta and Mika Sutinen were elected as new members of the Board of Directors for the term expiring
at the end of the Annual General Meeting of 2023. The Company announced on April 1, 2022, the
appointment of Aarne Aktan as the new CEO starting from July 1, 2022. After Aktan took on his duties as
Solteq’s CEO and resigned from the Board, the Board of Directors consists of five (5) members. The
Board of Directors met 16 times during the year and had an attendance rate of 95 percent.
The Board’s Diversity Principles
The purpose of the Board of Director’s diversity policy is to define the objectives and methods for
achieving appropriate diversity for the Board of Directors and promoting the collective effectiveness of
the Board’s activities.
Diversity of the Board of Directors supports the Company’s business operations and development.
Diversity of the know-how, experience, and opinions of the Board members promotes the ability to have
an open-minded approach to innovative ideas and the ability to support and challenge the Company’s
operative management. Adequate diversity promotes open discussion and independent decision-
making. Diversity also promotes good corporate governance, efficient supervision of the Company’s
directors and executives, as well as succession planning.
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The objective is that the Board of Directors has broad know-how, experience, perspectives, and
knowledge of Solteq and its stakeholders, which enables the Board of Directors to perform its tasks
effectively, particularly with respect to strategy and risk management. A further objective is for the
gender that is the minority to represent at least 1/3 of the Board of Directors.
The Company’s current Board of Directors is compliant with the diversity objectives. The Board members
represent diverse industry and market know-how as well as a variety of professional and academic
backgrounds. In 2022, the assembly of the Board of Directors was updated as following:
• Between January 1, 2022, and March 23, 2022, the Board of Directors was composed of three men
and two women.
• Between March 24, 2022, and June 30, 2022, the Board of Directors was composed of four men
and two women.
• Between July 1, 2022, and December 31, 2022, the Board of Directors was composed of three men
and two women.
The Audit Committee of the Board of Directors
The Audit Committee monitors the Group’s profit performance, budget preparation principles,
budgeting, financing situation, and risk management. The Audit Committee’s duties are to:
• monitor the Company’s financial and financing situation,
• monitor the Company’s financial statements reporting process,
• supervise the Company’s financial reporting and merger and acquisition processes,
• monitor the efficiency of the Company’s internal control as well as any internal auditing and risk
management systems,
• review the Company’s corporate governance statement, including the description of the main features
of the control and risk management systems related to the financial reporting process,
• monitor the financial statements and statutory audits of the consolidated financial statements,
• assess the independence of the statutory auditor or audit firm,
• assess the audit firm’s provision of related services,
• prepare a proposal for the election of the auditor,
• maintain contact with the auditor and review the reports prepared by the auditor for the Audit
Committee, and
• assess compliance with laws and regulations.
The Audit Committee consists of three members. The Board of Directors elects the members and the
Chairman of the Audit Committee from among its members. The members of the Committee shall have
the qualifications required for performing the tasks of the Committee, and at least one member shall have
expertise in accounting or auditing.
The Company’s CEO and CFO present the matters to the Audit Committee. The Audit Committee may
use external experts and advisors if necessary.
The Chairman of the Audit Committee prepares the agendas for the Committee’s meetings and decides
on the items to be included in the agenda based on discussions with the management of the Company.
The CFO or another person appointed by the Audit Committee acts as secretary of the Committee.
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The minutes of the Committee meetings are made available to the Board of Directors. The Chairman of
the Committee also reports to the Board of Directors on significant observations.
The members of the Committee are paid a fee determined by the Annual General Meeting.
The members of the Audit Committee must be independent of the Company and at least one of the
members must be independent of the Company’s significant shareholders.
Solteq Plc’s Board of Directors has an Audit Committee whose members were Aarne Aktan, Markku
Pietilä and Katarina Segerståhl from January 1 to June 30, 2022. The Audit Committee was reorganized
as Aarne Aktan resigned from the Board of Directors on July 1, 2022, as he assumed his position as the
CEO of the Company. The Company announced on August 11, 2022, the appointment of Mika Sutinen as
a member of the Audit Committee. Sutinen acts as the Chairman of the Committee. The Audit Committee
consists of one member independent of the Company and two members independent of the Company
and its significant shareholders.
During the financial year 2022, the members of the Audit Committee were paid a fee for attending
Committee meetings. The fee was determined by the Annual General Meeting.
CEO
The Board of Directors appoints the CEO. The CEO oversees the management of the Company’s business
operations and governance in accordance with the Articles of Association, the Finnish Companies Act,
and the instructions issued by the Board of Directors. The CEO is assisted by the Executive Team in the
management of the Group.
The Company announced the resignation of its CEO Olli Väätäinen on September 17, 2021. Väätäinen
served as the Company’s CEO until January 31, 2022. The Company appointed Kari Lehtosalo, who has
acted as the CFO and member of the Executive Team since 2019, as Interim CEO as of February 1, 2022.
Aarne Aktan, who had acted as a member of the Board since 2015, took on his duties as Solteq’s new CEO
on July 1, 2022.
Executive Team
The Executive Team assists the CEO in the operative management of the Company, prepares matters
dealt by the Board of Directors and the CEO, and plans and monitors the operations of the business units.
The Executive Team regularly convenes on a weekly basis. The CEO is the Chairman of the Executive
Team.
From January 1 to January 31, 2022, the members of the Executive Team were Olli Väätäinen (Chairman,
CEO, and Solteq Software), Matti Djateu (Marketing and PR), Kirsi Jalasaho (People and Culture), Kari
Lehtosalo (Finance and IR), and Juha Rokkanen (Solteq Digital).
From February 1 to June 30, 2022, the members of the Executive Team were Kari Lehtosalo (Chairman,
Interim CEO, Finance and IR), Matti Djateu (Marketing and PR), Kirsi Jalasaho (People and Culture), and
Juha Rokkanen (Solteq Digital).
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From July 1 to December 31, 2022, the members of the Executive Team were Aarne Aktan (Chairman,
CEO) Kari Lehtosalo (Finance and IR, Solteq Software), Matti Djateu (Marketing and PR), Kirsi Jalasaho
(People and Culture), and Juha Rokkanen (Solteq Digital).
Internal Audit
The Group does not have a separate internal audit organization. The practical implementation of internal
auditing is the responsibility of the financial department, and it is monitored by the Audit Committee
appointed by the Board of Directors. The objective is to ensure the consistency of administrative
practices and accounting principles.
External Audit
Solteq Plc has one auditor. If the auditor is not accredited as Authorized Public Accountant, the Company
shall additionally have one deputy auditor. The auditors are elected until further notice. The primary
function of external auditing is to verify that the financial statements provide accurate and adequate
information about Solteq Group’s result and financial position for the financial period. The Auditors also
report to the Audit Committee and, if needed, to the Board of Directors on the ongoing auditing of
administration and operations.
The Annual General Meeting 2022 re-elected KPMG Oy Ab, Authorized Public Accountants, as auditors
and Petri Sammalisto, APA, acting as the Chief Auditor.
Solteq Group’s audit fees in 2022 amounted to EUR 148 thousand, fees for certificates and statements to
EUR 7 thousand, and other professional services amounted to EUR 85 thousand. The audit fees paid to
the Parent Company’s auditor, KPMG Oy Ab, for 2022 were EUR 101 thousand, fees for certificates and
statements to EUR 7 thousand, and fees for other professional services amounted to EUR 85 thousand.
Shares Held by the Management
According to the shareholding register maintained by Euroclear Finland Oy, the governing bodies held
Solteq Plc shares as following on December 31, 2022:
• the members of the Board: 17,000 shares
o Chairman of the Board Markku Pietilä: 17,000 shares
• CEO Aarne Aktan: 8,853 shares
In addition, the members of the Executive Team, excluding the CEO, held 91,503 Solteq Plc shares.
Internal Control and Risk Management Systems Associated with Financial Reporting
The ultimate responsibility for accounting and financial administration lies with Solteq Plc’s Board of
Directors. The Board is responsible for internal control, and the CEO is responsible for the practical
organization and monitoring of the control system. The steering and monitoring of business operations
is based on a reporting and business planning system that covers the entire Group. The CEO and CFO
deliver monthly reports regarding the Group’s financial situation and development at Board and
Executive Team meetings.
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Risk Management System
The Group’s risk management is guided by legal requirements, business goals set by the Company’s
shareholders as well as the expectations of other stakeholders. Risk management aims to identify and
acknowledge the risks involved in the Company’s operations as well as to make sure that the risks are
appropriately managed when making business decisions. The Company’s risk management supports
the achievement of strategic goals and ensures the continuity of business operations.
Solteq takes risks according to its strategy and objectives. The Company is not willing to take risks that
might compromise the continuity of operations, have a significant negative impact on the Company’s
operations, or might be uncontrollable. Risks are divided into operational, personnel, financing, legal,
and financial risks. In the process of risk management, the goal is to identify and assess the risks, after
which a risk-specific plan is drawn up and concrete action is taken. Such actions may include, for
example, avoiding the risk, mitigating the risk by various means, or transferring the risk by means of
insurance or agreements. When necessary, the Board of Directors will be provided reports on any
material changes and new significant risks identified in the process of risk management.
In 2022, the main risks were related to the general financial uncertainty caused by Russia’s invasion of
Ukraine, high inflation, increased interest rates, and the availability of labor. Other key uncertainties and
risks were related to the management of changes in financing and balance sheet structures, the timing
and pricing of business deals that are the basis for revenue, changes in general costs, information
security and data protection, development and commercialization of the Company’s own products, and
the capability to manage extensive customer contracts and deliveries.
The key business risks and uncertainties of the company are regularly monitored by the Board
of Directors and the Executive Team. In addition, the Company has an Audit Committee established
by the Board of Directors.
Control Environment
The goal of Solteq’s internal control is to support the implementation of the Group’s strategy and ensure
compliance with regulations. The system is based on group-level policies, guidelines and processes and
controls of business operations and support processes. The operating culture is built by the steering and
control of the Company’s operations by the Board of Directors, the management methods of the
Company’s management, the Company’s organizational structure and management system, the
effective utilization of a global information system as well as the employees’ competence.
The financial department operating under the CFO is responsible for the general control function in
financial reporting. The operations are steered by the Board of Directors’ Audit Committee. The Group
applies the International Financial Reporting Standards (IFRS).
Risk Assessment in Financial Reporting
The aim of financial reporting is to ensure that assets and liabilities belong to the Company; all rights and
liabilities of the Company are presented in the financial statements; items in the financial statements have
been classified, disclosed, and described correctly; assets, liabilities, income, and expenditure are
entered in the financial statements at the correct amounts; all the transactions during the reporting
period are included in the accounts; transactions entered in the accounts are factual transactions; and
that the assets have been secured. The risk management process includes the annual identification and
analysis of risks related to financial reporting. In addition, the aim is to analyze and report all new risks
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immediately after they have been identified. Considering the nature and extent of the Group’s business
operations, the most significant risks associated with the reliability of financial reporting are associated
with revenue recognition, the identification of credit loss risks, the capitalization of product development
expenses, impairment testing of assets (including goodwill, capitalized product development expenses
and unfinished projects) and deferred taxes.
Control Functions
The correctness and reliability of financial reporting are ensured through compliance with the Group’s
guidelines. Controls that ensure the correctness of financial reporting include controls related to
accounting transactions, controls related to the selection of — and compliance with — the accounting
principles, information system controls, and fraud controls.
Revenue recognition is based on the existence of obligatory sales documentation. Goodwill is tested for
impairment during the last quarter of the year. Indications of impairment are also monitored on a
continuous basis. Information systems support compliance with the Group’s approval authorizations.
Personnel expenses account for a majority of Solteq’s expenditure. Actual and forecasted personnel
expenses are monitored, and the forecasts are regularly updated at a very detailed level. The results of
business operations and achievement of annual targets are assessed monthly in Executive Team and
Board meetings. Monthly reporting at the management and Board level includes both actual and forecast
data compared to the targets and the actual results of previous periods.
In line with its strategy, Solteq has complemented its organic growth by making targeted acquisitions.
Through making acquisitions, the Company aims to observe due diligence and utilize its internal and
external competence in the planning phase (e.g., due diligence) and in the integration phase.
Investor Communications and Financial Reporting
Solteq’s Disclosure Policy defines the practices followed in the Company’s investor communications.
The Disclosure Policy is compliant with EU and Finnish legislation, Nasdaq Helsinki’s rules and
guidelines for insiders, and the guidelines and regulations of the Finnish Financial Supervisory Authority
and other authorities. Disclosure Policy is available on the Company’s website.
Timeliness, simultaneousness, continuity, and transparency are the principles guiding financial
reporting. The purpose of these principles is to ensure that all market stakeholders have simultaneous
access to sufficient and correct information about the Company, its operations, goals, strategy, and
financial situation, to determine the fair value of Solteq Plc’s shares and listed financial instruments.
Monitoring
Monitoring refers to the process of assessing Solteq’s internal control system and its performance in the
long term. Solteq also continuously monitors its operations through various assessments, such as
internal audits and external audits. Solteq’s management monitors internal control as part of routine
management work. The business management is responsible for ensuring that all operations comply
with applicable laws and regulations. The financial department monitors compliance with the financial
reporting process and control. The financial department also monitors the correctness of external and
internal financial reporting. The Board of Directors assesses and ensures the appropriateness and
effectiveness of Solteq’s internal control and risk management. Solteq’s internal control is also assessed
by the Company’s auditor. The external auditor verifies the correctness of external financial reporting.
Performed as part of the continuous auditing process, auditing is focused on typical controls that ensure
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the correctness of financial reporting. The most significant observations and recommendations of the
audit process according to the auditing plan are reported to the Board of Directors.
Insider Administration
Solteq Plc complies with the Guidelines for Insiders issued by Nasdaq Helsinki Ltd on January 1, 2021.
Managers’ Transactions
Pursuant to the Market Abuse Regulation (MAR), the persons discharging managerial responsibilities
within the Company comprise the members of the Board of Directors and the Executive Team as well as
certain other persons whose duties satisfy the criteria for being a person discharging managerial
responsibilities.
Persons discharging managerial responsibilities are prohibited from all trading in Solteq Plc’s securities
for a period of 30 days before the date of publication of financial information bulletins. Persons
discharging managerial responsibilities and their closely associated persons must report their business
transactions exceeding the annual worth of EUR 5,000 related to the Company’s securities to the
Company and the Financial Supervisory Authority. The Company is required to publish the information
as a stock exchange bulletin and on the Company’s website.
Inside information and project-specific insider register
The Company will disclose inside information concerning the Company to the public as soon as possible,
unless a decision is taken to delay this upon the fulfilment of the preconditions set out in the Market Abuse
Regulation. If the company decides to delay the disclosure of inside information, the company shall
monitor the fulfilment of delaying criteria throughout the delay process i.e., until the insider information
is published or the project in question expires. The company will not disclose information about projects
that have lapsed. If the confidentiality of the information that is subject to the delay cannot be guaranteed,
the company will publish the insider information as soon as possible.
Project-specific insider registers will be maintained in a situation where the company has decided to
delay the disclosure of inside information and established a project-specific insider register concerning
inside information. Persons participating in projects affecting the value creation of the company’s shares
belong to the company’s project-specific group of insiders. Persons taking part in the project may not
trade company shares, debt instruments or related derivatives, or other financial instruments, and any
transactions related to them are forbidden until the project either expires or is published.
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Board of Directors on December 31, 2022
Markku Pietilä
Chairman of the Board
Year of birth:
1957
Education:
M.Sc. (Tech.), MBA
Main occupation:
Board Professional
Key work experience:
CEO, Kymiring Oy; Chairman of the Board, Profiz
Business Solutions Oy; Senior management positions, Componenta Oyj
Member of the Board of Directors since:
2008
Independent of the Company
Panu Porkka
Year of birth:
1977
Education:
The Finnish Matriculation Examination
Primary Occupation:
CEO, Verkkokauppa.com Oyj
Key work experience:
CEO, Suomalainen Kirjakauppa Oy; Sales Director,
Tokmanni Oy
Member of the Board of Directors since:
2019
Independent of the Company and its significant shareholders
Katarina Segerståhl
Year of birth:
1981
Education:
PhD, Information Systems
Primary Occupation:
Founder and CEO, Adalyon Oy
Key work experience:
Chief Strategy Officer (CSO), Aava Medical; Head
of Strategic Design, Tieto Finland Oy
Member of the Board of Directors since:
2019
Independent of the Company and its significant shareholders
Mika Sutinen
Year of birth:
1966
Education:
M.Sc. (Econ.)
Main occupation:
Industrial Partner, Vaaka Partners Oy; Chairman of the
Board, Reaktor, Framery, Luhta, Jungle Juice Bar, SGN Group, Ellun
Kanat, Talentree, Staria, Business Forum Group (Nordic Business
Forum), and Kalpa; Member of the Board, LähiTapiola Rahoitus
Key work experience:
CEO, Musti Group Oy; CEO, Best Friend Group;
Consultant, Partner, Instead Oy
Member of the Board of Directors since:
2022
Independent of the Company and its significant shareholders
Anni Sarvaranta
Year of birth:
1985
Education:
M.Sc. (Tech.), Energy Technology
Main occupation:
CEO, Auris Kaasunjakelu Oy & Auris Kaasuenergia Oy
Key work experience:
SVP of Transmission Business, Gasgrid Finland
Oy; Development Director, Baltic Connector Oy; Head of Strategy, Helen
Oy
Member of the Board of Directors since:
2022
Independent of the Company and its significant shareholders
Annual Report 2022
18
Executive Team on December 31, 2022
Aarne Aktan
Year of birth:
1973
Education:
B.Sc. (Econ.)
Main occupation:
CEO, Solteq Plc
Key work experience:
CEO, Synlab Oy (2019–2022); CEO, Pihlajalinna Plc (2016–
2017); CEO, Talentum Oyj (2011–2016); CEO, Quartal Oy (1997–2011)
Member of the Executive Team since:
July 1, 2022
Key concurrent positions of trust:
Chairman of the Board of Smartum Oy,
member of the Board of Trainers’ House Plc, and advisor of two Intera Partners
funds.
Kari Lehtosalo
Year of birth:
1972
Education:
MBA
Main occupation:
CFO, Solteq Plc
Essential work experience:
CFO, IBM (2013-2019); Finance and Business
Development leadership positions, IBM (2001-2012)
Member of the Executive team since:
September 23, 2019
Key concurrent positions of trust:
-
Matti Djateu
Year of birth:
1975
Education:
–
Primary occupation:
CDO, Solteq Plc
Key work experience:
Head of Digital & PR, Scotch & Soda (2015–2017);
Consultant, Peuple Bavard (2014–2015); Creative Director, Dentsu Aegis Network
(2011–2014)
Member of the Executive Team since:
June 16, 2017
Key concurrent positions of trust:
–
Kirsi Jalasaho
Year of birth:
1974
Education:
M.Sc. (Econ.)
Primary occupation:
Vice President, People, Culture, Solteq Plc
Key work experience:
Vice President, Marketing and IR, Solteq Plc (2015–2017);
Chief Financial Officer (CFO), Descom Group Oy (2012–2015)
Member of the Executive Team since:
April 3, 2017
Key concurrent positions of trust:
Board member, Jyväs-Parkki Oy; member of
the Central Finland regional board, Technology Industries of Finland
Juha Rokkanen
Year of birth:
1969
Education:
BBA
Primary occupation:
EVP, Solteq Digital
Key work experience:
CEO, inPulse Works (2016–2017); Managing Director,
Innofactor Finland (2013–2015); Managing Director, atBusiness Oy, (2006 –
2013); Sales Director, WM-Data Novo Oyj (2003–2006)
Member of the Executive Team since:
June 12, 2017
Key concurrent positions of trust:
Member of the Board of Directors, The Finnish
Software and E-business Association
Vuosikertomus 2020
19
Remuneration Report
Annual Report 2022
20
Remuneration Principles
The Remuneration Report contains information on the remuneration of Solteq Plc's Board of Directors
and CEO from January 1 to December 31, 2022. The report has been prepared in accordance with the
recommendations of the Corporate Governance Code 2020 and the requirements of the Finnish
Securities Markets Act and Limited Liability Companies Act.
The remuneration of Solteq Plc’s governing bodies is based on the remuneration policy, which was
determined at the Annual General Meeting held on June 10, 2020. The remuneration policy shall be
applied until the Annual General Meeting in 2024 unless the Board of Directors decides to present it to
the Annual General Meeting earlier. The remuneration policy is available on the Company's website.
In 2022, the Company's remuneration policy was implemented accordingly, and no exceptions were
made. This remuneration report contains essential information on the remuneration paid and due to the
Company's Board of Directors and CEO for the financial year 2022.
The Remuneration Report will be presented at the Annual General Meeting in 2023. In addition, the
remuneration report is also published in a stock exchange bulletin and on the Company’s website.
Solteq’s Performance and Remuneration Development
The following compares the development of the Company's result and the average salary of its
employees with the remuneration of Board of Directors and CEO over the past five years.
The remuneration of the Board of Directors is based on monthly remuneration and remuneration paid per
meeting, which are decided by the Annual General Meeting. The members of the Board were paid EUR
1,500 and the Chairman of the Board EUR 3,000 during January 1–March 31, 2022. The monthly
remuneration was increased in the Annual General Meeting 2022. The monthly remuneration paid to a
member of the Board of Directors was increased by EUR 1,000 to EUR 2,500 and the monthly
remuneration paid to the Chairman by EUR 2,000 to EUR 5,000. The EUR 500 fee paid per meeting has
remained the same during the financial year.
In 2022, the CEO's remuneration has consisted of the fixed fee based on the CEO’s contract. The CEO
had no performance-based or other short- or long-term incentive schemes. The CEO changed during
2022 as CEO Olli Väätäinen resigned from his duties on January 31, 2022. The Company’s CFO Kari
Lehtosalo acted as the Interim CEO from February 1, 2022, to June 30, 2022. CEO Aarne Aktan took on
his duties on July 1, 2022. The company presents figures representing the paid or due compensations to
the CEOs during the year 2022.
Annual Report 2022
21
Remuneration of the Board of Directors
The Annual General Meeting decides on the remuneration paid to the Board of Directors. In accordance
with the decisions made in the 2021 Annual General Meeting, the Chairman of the Board was paid a
monthly fee of EUR 3,000, and other Board members were paid a monthly fee of EUR 1,500 between
January 1, 2022, and March 31, 2022. In accordance with the decisions made in the 2022 Annual General
Meeting, the monthly fee paid to the Chairman of the Board was EUR 5,000 and to the other Board
members EUR 2,500. All Board members were paid a meeting fee of EUR 500 for Board and Committee
meetings. Board members' travel expenses were compensated in accordance with the Company's
applicable travel guidelines.
Remuneration paid and due to the Company's Board of Directors for the financial year 2022.
TEUR
Annual Remuneration
Meeting Remuneration
Total Remuneration
Pietilä Markku (Chairman of the Board)
54
10,5
64,5
Aktan Aarne (Jan 1–Jun 30, 2022)
12
5
17
Kopra Lotta (Jan 1–Mar 24, 2022)
4,5
2
6,5
Porkka Panu
27
7,5
34,5
Sarvaranta Anni (Mar 24–Dec 31, 2022)
22,5
5,5
28
Segerståhl Katarina
27
10,5
37,5
Sutinen Mika (Mar 24–Dec 31, 2022)
22,5
6,5
29
Total
169,5
47,5
217
The meeting fees also include the fees paid for Committee meetings.
Annual Report 2022
22
CEOs Remuneration
The Board of Directors decides on the terms and conditions of the CEO’s service agreement and decides on
the remuneration of the CEO in accordance with the remuneration policy.
The CEOs were paid a fixed remuneration (a fixed part) in accordance with the CEO’s service agreement. In
2022, the CEOs did not have any performance-based or other short or long-term incentive schemes (possible
variable part) in addition to the basic salary.
Remuneration paid and due to the CEOs for the financial year 2022:
TEUR
Fixed Remuneration
Väätäinen Olli
58
Lehtosalo Kari
114
Aktan Aarne
175
Total
347
The remuneration paid to the CEO includes taxable fringe benefits.
Other key terms:
• The CEO’s notice period is 6 months
• No severance pay is stipulated by the CEO’s contract
In accordance with the Remuneration Policy, the Board of Director’s may decide changes to the
remuneration of the CEO and deputy CEO. The remuneration paid may consist of a fixed remuneration,
fringe benefits, and short and long-term incentive schemes.
Report of the Board of Directors
Annual Report 2022
24
Table of contents
Report of the Board of Directors
25
Consolidated financial statements
41
Consolidated statement of comprehensive income
42
Consolidated statement of financial position
43
Consolidated cash flow statement
44
Consolidated statement of changes in equity
45
Notes to consolidated financial statements
46
1. GENERAL INFORMATION
46
1.1 Group information
46
1.2 Basis of preparation
46
1.3 New and amended standards applied in financial year
46
1.4 Management judgement and use of estimates
47
2. FINANCIAL RESULT
47
2.1 Segment reporting
47
2.2 Revenue from contracts with customers
49
2.3 Employee benefit expenses
52
2.4 Other income and expenses
52
2.5 Research and development costs
53
2.6 Financial income and expenses
54
2.7 Income taxes
55
2.8 Earnings per share
56
2.9 Adjustments to cash flow from business operations
57
3. TANGIBLE AND INTANGIBLE ASSETS
57
3.1 Tangible assets
57
3.2 Right-of-use assets
58
3.3 Intangible assets
60
3.4 Depreciation, amortization, and impairment
64
4. OPERATIONAL ASSETS AND LIABILITIES
64
4.1 Trade and other receivables
64
4.2 Inventories
65
4.3 Trade and other payables
65
4.4 Provisions
65
5. CAPITAL STRUCTURE AND FINANCIAL ITEMS
66
5.1 Financial risk management and capital management
66
5.2 Financial assets and liabilities
68
5.3 Other investments
71
5.4 Cash and cash equivalents
71
5.5 Equity
71
5.6 Conditional debts and liabilities
72
6. OTHER NOTES
73
6.1 Consolidation principles and group companies
73
6.2 Related party transactions
74
6.3 Business combinations
75
6.4 The Russian invasion of Ukraine and its impact on financial reporting
77
6.5 Events after the balance sheet date
78
PARENT COMPANY FINANCIAL STATEMENTS
79
Parent company's statement of comprehensive income
79
Parent company's statement of financial position
80
Parent company's cash flow statement
81
Parent company's statement of changes in equity
82
Notes to Solteq Plc financial statements
83
Proposal for distribution of profits
100
Signatures to the report of the Board of directors and the financial statements
101
Auditor's report
102
Annual Report 2022
25
Report of the Board of Directors
The profitability of Solteq weakened due to a decrease in demand and difficulties in product development
The year 2022 was tough for Solteq. The Group’s revenue was EUR 68.4 million (69.1) for the financial year, staying flat
relative to the comparison period. The biggest change from the previous year was the Group’s profitability. The
comparable EBITDA was EUR 6.4 million (12.6) and the comparable operating result was EUR 0.9 million (7.4).
The Russian invasion of Ukraine drove the global economy into uncertainty with high inflation and interest rate levels.
The uncertain operating environment reflected the demand in regard to the Solteq Digital segment. The revenue of the
segment was EUR 42.1 million (44.3). The decrease in demand affected the profitability of the segment. The EBITDA was
EUR 5.3 million (7.9) and the operating result was EUR 3.2 million (5.6).
The revenue of the Solteq Software segment increased and was EUR 26.3 million (24.8). Despite the growth, the
problems with the product development of the Utilities business continued since the beginning of the year and
weakened the profitability of the segment. The financial year’s comparable EBITDA was EUR 0.6 million (4.6) and the
comparable operating result was EUR -2.8 million (1.8). The two acquisitions made in 2022 aimed to strengthen the
offering and market position of the Utilities business. In addition, the Solteq Robotics business area, which had
demanded significant product development investments, was terminated for being unprofitable.
The market situation and the challenges related to the product development of Utilities continue to strain the company
during the current financial year. Despite this, the outlook for the Retail & Commerce segment is expected to remain
moderate. The estimated outlook for the Utilities segment is good. The company aims to resolve the product
development problems during the first half of the year. The updated strategy, the new management, and investments
in internationalization will create a path toward profitable growth in the near future.
Nordic IT market outlook within the key industries for Solteq
Solteq aims to meet the changing needs of the energy sector, retail industry, and e-commerce through its product
development and expert services in the Nordics. Starting from January 1, 2023, the Group’s reportable business
segments are Utilities and Retail & Commerce. The Utilities segment offers software solutions and expert services for
the energy sector, and the Retail & Commerce segment for retail and e-commerce. The business areas share similar
characteristics, such as the rapidly evolving digital transformation and the need for smarter and more efficient core
functions. The company estimates that its offering matches well with the industry-specific development needs where
the Nordic decision-makers are focusing their IT investments in the coming years.
The demand for software solutions and expert services in the Nordic energy sector is accelerated by changes in the
industry’s regulation, the transition to renewable energy sources, and the potential for more streamlined business
operations created by the developing technology. The business of the Utilities segment consists of software solutions
and expert services, which comprehensively take into account the regulatory changes in the Nordics and EU. Among
these are nationally driven datahub projects for centralized information exchange and the unification of operating
models regarding measurement practices and the opening of electricity markets. The company estimates that the
segment’s industry-specific expertise and offering create a clear competitive advantage in the Nordic energy market.
The Russian invasion of Ukraine has created significant market uncertainties, such as high inflation and increased
interest rates. The uncertainties affect the Nordic market by weakening the demand, in particular, for the offering of
the Retail & Commerce segment. However, the demand is driven by the rapidly evolving digitalization and the need for
the secure, reliable, and coherent IT ecosystems.
Annual Report 2022
26
Profit guidance 2023
Solteq Group’s revenue is expected to remain on the same level and operating profit to be positive
Key Figures
2022
2021
Change-%
2022-2021
2020
Revenue, TEUR
68,426
69,055
-0.9
60,452
EBITDA, TEUR
5,555
12,267
-54.7
10,380
Comparable EBITDA, TEUR
6,400
12,556
-49.0
10,810
Operating result, TEUR
-4,406
7,123
-161.9
5,350
Comparable operating result, TEUR
888
7,412
-88.0
5,780
Result for the financial period, TEUR
-5,404
4,100
-231.8
1,980
Earnings per share, EUR
-0.28
0.21
-231.7
0.10
Operating result, %
-6.4
10.3
8.9
Comparable operating result, %
1.3
10.7
9.6
Equity ratio, %
30.3
36.9
35.5
Revenue and Profit
Revenue decreased by 0.9 percent compared to the previous year and totaled EUR 68,426 thousand (69,055). Operating
profit for the review period was EUR -4,406 thousand (7,123). Comparable operating profit was EUR 888 thousand
(7,412). Profit before taxes was EUR -6,574 thousand (5,245) and the profit for the financial period was EUR -5,404
thousand (4,100).
Solteq Digital
The revenue of the Solteq Digital segment was EUR 42,142 thousand (44,302), a decrease of 4.9 percent relative to the
comparison period. The segment’s EBITDA was EUR 5,295 thousand (7,916), and the operating result was EUR 3,228
thousand (5,563).
The segment’s business consists of three solution areas: digital business and commerce solutions, data and analytics
solutions, and business solutions. Of the segment’s revenue, 47.4 percent was derived from digital business and
commerce solutions, 19.7 percent from data and analytics solutions, and 32.9 percent from business solutions.
Annual Report 2022
27
Solteq Software
The revenue of the Solteq Software segment was EUR 26,284 thousand (24,753), an increase of 6.2 percent relative to
the comparison period. The comparable EBITDA was EUR 641 thousand (4,587), and the comparable operating result
was EUR -2,820 thousand (1,795).
The segment’s business consists primarily of the Utilities business and retail sector software and services. The Utilities
business accounted for 55.5 percent and the Retail business for 37.8 percent of the segment’s revenue.
The Utilities product portfolio expanded with two acquisitions, an energy sector software provider Enerity Solutions Oy
in January and an energy sector system and service provider S2B Energia Oy in November. The acquisitions strengthen
the Company’s leading expert position in the changing energy sector and create opportunities for growth within the
international market. A significant milestone was reached in February as the customers switched to the centralized
information exchange system, Datahub. The introduction of a centralized information exchange system has been a
significant step towards a flexible electricity retail market of the future. Going forward, Datahub will be further
developed to meet the needs of the changing energy market, and it will enable, among other things, the formation of
energy communities and the introduction of a 15-minute imbalance settlement period in 2023. Utilities will continue to
invest in product development and internationalization.
In the product development of Retail business area, the Nordic launch of Solteq Commerce Cloud was a key focus area.
A significant milestone during the fourth quarter was the preparation for implementation at Royal Arena, Copenhagen.
Cloud-based technology, versatile integration capabilities, open interfaces, and features supporting omnichannel
business create a significant competitive advantage for Solteq Software’s Retail business.
Recurring revenue accounted for 37.4 percent of the segment's revenue. This was lower than previous estimates, due
to the high amount of expert work related to delivery projects. Recurring revenue consists of software licensing,
maintenance, and support fees.
During the review period, the Company wrote off EUR 4,418 thousand worth of investments made to the product
development of the Solteq Robotics business. In November, the business area was terminated for being unprofitable.
During the review period, Solteq invested EUR 3,676 thousand in total into product development.
Balance Sheet and Finance
Total assets amounted to EUR 74,336 thousand (75,806) at the end of the review period. Liquid assets totaled EUR 2,057
thousand (3,588). The company has a standby credit limit of EUR 5,000 thousand and a bank account credit limit of EUR
2,000 thousand. At the end of the review period, EUR 5,000 thousand (0) of the standby credit limit and EUR 805
thousand (0) of the bank account credit limit was in use. At the end of the review period, the company had a EUR 1,463
thousand (1,463) Business Finland loan for product development.
The Group’s interest-bearing liabilities were EUR 33,474 thousand (29,524).
Solteq Group’s equity ratio was 30.3 percent (36.9).
On October 1, 2020, Solteq issued a fixed rate bond with a nominal value of EUR 23.0 million. Annual interest of 6.0
percent is paid on the bond, and it will mature on October 1, 2024. The bond can be redeemed before its final maturity
date.
Annual Report 2022
28
In the fourth quarter, efforts were also made to ensure the flexibility of financing for the current financial year. The
company initiated a written procedure to amend the terms and conditions of its EUR 23 million senior unsecured fixed
rate notes. Due to the approved amendments to the terms and conditions, the working capital facility was increased
from EUR 7 million to EUR 10 million. The increased flexibility in financing is a good thing for the company, although we
strive to develop our business in a way that doesn’t require additional debt.
The terms of the bond include financial covenants concerning the distribution of funds and incurring financial
indebtedness other than permitted under the terms of the bond (Incurrence Covenant). The covenants require that the
equity ratio exceeds 27.5 percent, the interest coverage ratio (EBITDA/net interest cost) exceeds 3.00:1, and that the
Group’s net interest-bearing debt to EBITDA ratio does not exceed 4:1. The covenants concerning the distribution of
funds and incurring financial indebtedness other than permitted under the terms of the bond are not fulfilled based on
the financial year 2022. The fulfillment of the covenants is always reviewed based on the last reported 12-month period.
Violations of the above-mentioned financial covenants of the bond do not, as such, lead to the right to demand
immediate repayment of the bond, but they limit the distribution of the company's funds and incurring financial
indebtedness other than permitted under the terms of the bond.
Investment, Research, and Development
The net investments during the review period were EUR 9,217 thousand (7,147). Of the net investments, EUR 5,291
thousand were related to business acquisitions. Solteq Plc acquired the entire share capital of Enerity Solutions Oy on
January 3, 2022, and the entire share capital of S2B Energia Oy on November 7, 2022. During the comparison period,
Solteq Plc acquired the consulting business of Partiture Oy on March 1, 2021, and Solteq Denmark A/S acquired the
entire share capital of Forsyning 360 ApS on October 1, 2021. EUR 3,676 thousand (2,807) of the net investments were
capitalized development costs relating to continued further development of the existing software products and the
development of new software products. Other investments were EUR 250 thousand (564). Other investments include
the net change in rented premises and equipment, totaling EUR 302 thousand (492). During the review period, Solteq
Plc wrote off EUR 4,418 thousand in product development investments relating to the Solteq Robotics business.
Capitalized development costs included EUR 2,367 thousand (2,079) of personnel costs.
Personnel
The number of permanent employees at the end of the review period was 662 (648).
2022
2021
2020
Average number of personnel during the financial period
676
637
593
Employee benefit expenses, TEUR
37,273
33,987
31,379
Annual Report 2022
29
Related Party Transactions
Solteq Group’s related parties include the Board of Directors, the CEO, and the Group’s Executive Team, as well as their
related parties and entities according to the IAS24 standard. The related party transactions and euro amounts are
presented in attachment 6.2.
Shares, Shareholders, and Treasury Shares
Solteq Plc’s equity on December 31, 2022, was EUR 1,009,154.17 which was represented by 19,396,501 shares. The
shares have no nominal value. All shares have an equal entitlement to dividends and company assets. Shares are
governed by a redemption clause.
Solteq Plc did not hold any treasury shares at the end of the review period.
Exchange and Rate
During the review period, the exchange of Solteq’s shares in the Nasdaq Helsinki Ltd was 13.0 million shares (25.1) and
EUR 36.3 million (127.8). The highest rate during the review period was EUR 4.94 and the lowest rate was EUR 1.15. The
weighted average rate of the share was EUR 2.81 and the end rate was EUR 1.23. The market value of the company’s
shares at the end of the review period totaled EUR 23.9 million (90.8).
Ownership
At the end of the review period, Solteq had a total of 7,864 shareholders (7,970). Solteq’s ten largest shareholders
owned 10,381 thousand shares, i.e. they owned 53.5 percent of the company’s shares and votes. Solteq Plc’s members
of the Board of Directors and CEO owned 26 thousand (328) shares on December 31, 2022.
Distribution of Holdings and Shareholder Information
Distribution of Holdings by Sector December 31, 2022
Number of owners
Shares and votes
PCS
%
PCS
%
Private companies
254
3.23
4,296,922
22.15
Financial and insurance institutions
12
0.15
1,380,743
7.12
Public sector organizations
3
0.04
5,196,890
26.79
Households
7,566
96.21
8,134,578
41.94
Non-profit organizations
4
0.05
93,731
0.48
Foreign owners
17
0.22
293,637
1.51
Total
7,864
100.00
19,396,501
100.00
Total of nominee registered
8
0.10
317,102
1.63
Annual Report 2022
30
Distribution of Holdings by Number of Shares December 31, 2022
Number of owners
Shares and votes
Number of shares
PCS
%
PCS
%
1 - 100
2,600
33.06
122,907
0.63
101 - 1 000
4,003
50.90
1,667,864
8.60
1 001 - 10 000
1,129
14.36
3,065,266
15.80
10 001 - 100 000
117
1.49
3,197,402
16.48
100 001 - 1 000 000
11
0.14
4,062,403
20.94
1 000 000 -
4
0.05
7,280,659
37.54
Total
7,864
100.00
19,396,501
100.00
of which nominee registered
8
0.00
317,102
1.64
Major Shareholders December 31, 2022
Shares and votes
number
%
1.
Profiz Business Solution Oy
2,083,769
10.74
2.
Elo Mutual Pension Insurance Company
2,000,000
10.31
3.
Ilmarinen Mutual Pension Insurance Company
1,651,293
8.51
4.
Varma Mutual Pension Insurance Company
1,545,597
7.97
5.
Aktia Capital Mutual Fund
770,000
3.97
6.
Aalto Seppo Tapio
615,000
3.17
7.
Saadetdin Ali U
602,216
3.10
8.
Säästöpankki Small Cap Mutual Fund
500,000
2.58
9.
Incedo Oy
313,178
1.61
10.
Säästöpankki Itämeri Mutual Fund
300,000
1.55
10 largest shareholders total
10,381,053
53.52
Total of nominee-registered
317,102
1.63
Others
8,698,346
44.84
Total
19,396,501
100.00
Annual General Meeting
Solteq’s Annual General Meeting was held on March 24, 2022. The Annual General Meeting approved the financial
statements for the period January 1–December 31, 2021, and discharged the CEO and the Board of Directors from
liability.
In accordance with the proposal of the Board of Directors, the Annual General Meeting decided that no dividend is
directly distributed for the financial period ended on December 31, 2021, by a resolution of the Annual General Meeting
but that the Annual General Meeting authorized the Board of Directors to decide, at its sole discretion, on the
distribution of dividends of a maximum amount of EUR 0.10 per share from retained earnings. The authorization was
valid until September 30, 2022 (including September 30, 2022) and the board did not use it.
Annual Report 2022
31
The Annual General Meeting authorized the Board of Directors to decide on share issue, carried out with or without
payment and on issuing share options, and other special rights referred to in Chapter 10, Section1 of the Finnish
Companies Act as follows:
The maximum total amount of shares or other rights is 3,000,000. The authorization includes the right to give new
shares and special rights or convey the company’s own shares. The authorization includes the right to deviate from the
shareholders’ pre-emptive right of subscription if there is a weighty financial reason for the company, e.g., to improve
the capital structure, to execute of business acquisitions and other business improvement arrangements. The
authorization cannot be used to implement the company’s incentive schemes. The authorization includes the right for
the Board of Directors to decide on the other terms concerning the share issue and the granting of special rights,
including the subscription price and payment of the subscription price in cash or in whole or in part by other means
(subscription in kind) or by using a claim on the subscriber to offset the subscription price and to record it in the
company's balance sheet. The authorization is effective until the next annual general meeting, however, no longer than
until April 30, 2023 (April 30, 2023 included).
The Annual General Meeting authorized the Board of Directors to decide on share issue, carried out with or without
payment and on issuing share options, and other special rights referred to in Chapter 10, Section1 of the Finnish
Companies Act as part of the implementation of the company’s incentive schemes as follows:
The maximum total amount of shares or other rights is 1,000,000. The authorization includes the right to give new
shares and special rights or convey the company’s own shares. The authorization includes the right to deviate from the
shareholders’ pre-emptive right of subscription as part of the implementation of the company’s incentive schemes, in
which case there is a weighty financial reason for the company. The authorization includes the right for the Board of
Directors to decide on the other terms concerning the share issue and the granting of special rights, including the
subscription price and payment of the subscription price in cash or by using a claim on the subscriber to offset the
subscription price and to record it in the company's balance sheet. The authorization is effective until the next annual
general meeting, however, no longer than until April 30, 2023 (April 30, 2023, included).
The Annual General Meeting authorized the Board of Directors to decide on repurchasing of the company’s own shares
as follows:
On the basis of the authorization the number of own shares to be repurchased shall not exceed 500,000 shares. Shares
may be repurchased in one or more lots. The Company may use only unrestricted equity to repurchase own shares.
Repurchase of own shares may be made otherwise than in proportion to the share ownership of the shareholders
(directed repurchase). The purchase price shall be at least the lowest price paid for the company’s shares in regulated
trading at the time of purchase and no more than the highest price paid for Company shares in regulated trading at the
time of purchase. Own shares can be purchased to be used to improve the capital structure of the company, to execute
of business acquisitions and other business improvement arrangements or as a part of the implementation the
company’s incentive schemes. The authorization is effective until the next annual general meeting, however, no longer
than until April 30, 2023 (April 30, 2023, included).
In addition, the Annual General Meeting authorized the Board of Directors to decide on accepting the company’s own
shares as pledge as follows:
The Board of Directors is authorized to decide on accepting the company’s own shares as pledge (directed) regarding
business acquisitions or when executing other business arrangements. Accepting pledge may occur at once or in
multiple transactions. The number of own shares to be accepted as pledge shall not exceed 2,000,000 shares. The
authorization includes that the Board of Directors may decide on all other terms concerning the accepting as pledge.
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The authorization is effective until the next Annual General Meeting, however, no longer than until April 30, 2023 (April
30, 2023, included).
Board of Directors and Auditors
The Annual General Meeting on March 24, 2022, decided to appoint six members to the Board of Directors. Aarne Aktan,
Markku Pietilä, Panu Porkka, and Katarina Segerståhl were re-elected and Anni Sarvaranta and Mika Sutinen were
elected as members of the Board of Directors for the term expiring at the end of the Annual General Meeting of 2023.
In the Board meeting, held after the Annual General Meeting, Markku Pietilä was elected as the Chairman of the Board.
In addition, Aarne Aktan, Markku Pietilä, and Katarina Segerståhl were appointed as the members of the Audit
Committee and Aarne Aktan as the Chairman of the Audit Committee.
KPMG Oy Ab, Authorized Public Accountants, was re-elected as auditors, with Petri Sammalisto, APA, acting as the chief
auditor.
Aarne Aktan resigned from the Board of Directors and Audit Committee of Solteq Plc on July 1, 2022, as he assumed the
role of CEO of the Company. Thereafter, Solteq's Board of Directors consists of five members. The Audit Committee was
reorganized by the appointment of Mika Sutinen as a member and Chairman of the Committee.
Other Events During the Review Period
On January 3, 2022, Solteq Plc announced that it had signed an agreement to purchase the entire share capital of the
energy software company Enerity Solutions Oy. More detailed information regarding the acquisition is presented in the
financial statements.
On January 14, 2022, Solteq Plc announced that the company's Board of Directors has appointed Kari Lehtosalo, CFO,
as temporary CEO as of February 1, 2022.
On April 1, 2022, Solteq Plc announced that the Company’s Board of Directors has appointed Aarne Aktan as the new
Chief Executive Officer of the Company. Aktan will begin his duties on July 1, 2022, at the latest. Aarne Aktan has been
a member of Solteq’s Board of Directors since 2015, and he will continue as a member of the Board until taking over his
CEO duties. Thereafter Solteq’s Board of Directors consists of five board members.
On May 25, 2022, Solteq Plc announced it is lowering its revenue and profit guidance for 2022. The new profit guidance
for 2022 is: Solteq Group’s revenue is expected to grow and profit to weaken. The previous 2022 profit guidance,
published on April 28, 2022, as a part of the year’s first Interim Report, was: Solteq Group’s revenue is expected to grow
clearly and operating profit to improve. The company's long-term financial goals remain unchanged.
On August 11, 2022, Solteq Plc announced the reorganization of the Audit Committee of the Board of Directors by the
appointment of Mika Sutinen as a member of the Committee. Going forward, the Audit Committee consists of Mika
Sutinen (Chairman), Katarina Segerståhl, and Markku Pietilä.
On September 19, 2022, Solteq Plc announced it is lowering its revenue and profit guidance for 2022. The new profit
guidance for 2022 is: Solteq Group’s revenue is expected to stay at the same level and operating profit to be negative.
At the same time Solteq announced the write-off of product development investments made to the Solteq Robotics
business. The write-off was made during the third quarter and resulted in a one-time negative impact of EUR 4.4 million
on the Company’s operating result of 2022. The write-off has no cash flow effect.
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On September 19, 2022, Solteq Plc announced that the Company’s Board of Directors has appointed Kari Lehtosalo as
Executive Vice President of the Solteq Software segment. In addition to his new responsibilities, Lehtosalo will continue
his duties as the Company’s CFO and member of the Executive Team.
On November 9, 2022, Solteq Plc announced that VP of People and Culture and member of the Executive Team, Kirsi
Jalasaho, has announced her resignation to assume a new position outside of Solteq. Jalasaho will continue in her
current position and as a member of the Executive Team until the end of January 2023.
On November 25, 2022, Solteq Plc announced having updated its business strategy. The energy sector, retail industry,
and e-commerce are at the core of the business.
On November 25, 2022, Solteq Plc announced a written procedure to amend the terms and conditions of its EUR 23
million fixed rate bond, due 2024.
On December 12, 2022, Solteq Plc announced changes in its Executive Team. Director of Communications and Marketing
Christa Tavan, EVP of the Retail & Commerce segment Jesper Boye, EVP of the Utilities segment Jaakko Hirvensalo, and
General Counsel Mikko Sairanen will take on their Executive Team duties as of January 1, 2023. With the changes, EVP
of the Solteq Digital segment Juha Rokkanen and Chief Marketing Officer Matti Djateu will leave the Executive Team.
Both will continue in their positions and with the company until December 31, 2022.
On December 19, 2022, Solteq Plc announced making a clarification to the notice of the written procedure relating to
its EUR 23 million fixed rate bond and extending the voting deadline.
On December 30, 2022, Solteq Plc announced the amendments to the terms and conditions of the bond have been
approved in written procedure. After the approval, the permitted size of the Working Capital Facility was increased from
EUR 7 million to EUR 10 million.
Events After the Reporting Period
On January 16, 2023, Solteq Plc announced having updated its long-term financial targets. Solteq Plc’s Board of Directors
has approved the company’s segment-specific long-term targets, which are based on the updated strategy and segment
structure.
On January 27, 2023, Solteq Plc announced that the Board of Directors has appointed Oona Silén as VP of People and
Culture and member of the Executive Team of the company as of February 6, 2023.
The company’s management is not aware of other events of material importance after the review period that might
have affected the preparation of the Financial Statements.
Risks and Uncertainties
Material uncertainties and near-term risks consist of the general financial uncertainty caused by the Russian invasion of
Ukraine, high inflation, and the availability of labor. The Russian invasion of Ukraine has not had an immediate effect on
the Company’s business. The weakened economy and other indirect effects might affect the customers’ ability to make
investments in the long run. In addition, the change in the security environment increases the risk of cyber attacks.
Other key uncertainties and risks are related to the management of changes in financing and balance sheet structures,
the timing and pricing of business deals that are the basis for revenue, changes in general costs, developing company’s
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own products and their commercialization, and the company’s capability to manage extensive customer contracts and
deliveries.
The key business risks and uncertainties of the company are monitored constantly as a part of the Board of Directors’
and Executive Team’s duties. In addition, the company has the Audit Committee appointed by the Board of Directors.
The Russian invasion of Ukraine and its impact on Financial Reporting
The company has no business operations in Russia or in Ukraine. The management of the company is continuously
monitoring the Russian invasion of Ukraine and assessing its impact on the company’s operations, strategy, realization
of financial targets, performance, financial position, and cash flows.
The impairment tests of goodwill and capitalized development costs were performed during the last quarter of the
financial year 2022. No need for impairment was identified, but a clear margin was left for each tested unit and project.
No impairment losses were recognized in 2022 related to the goodwill of the group or to the merger losses of the parent
company. Impairment tests have been carried out at the cash-generating unit level. The recoverable amount has been
determined by means of the value in use. The determined anticipated cash flows are based on the operating profit
budget for 2023 and operating profit forecasts for the subsequent four years. The Russian invasion of Ukraine has had
no effect on the valuation of the assets.
The company has not historically incurred material credit losses, so the probability of such losses is low, and provisions
for them have been small. However, due to the general economic uncertainty, high inflation and increased interest
rates, the company has decided to prepare for possible credit losses by keeping the provision for credit losses
unchanged, which was increased due to the COVID-19 pandemic. No significant changes have yet been observed in
customers’ payment behavior. The company is following the situation closely. The company has also assessed the
valuation of its other asset items and discovered that the Russian invasion of Ukraine has had no effect on their valuation
so far.
The company has a EUR 23.0 million bond that matures on October 1, 2024. The company also has a EUR 5,000 thousand
standby credit limit and a EUR 2,000 thousand bank account credit limit. At the end of the review period EUR 5,000
thousand of standby credit limit was used. At the end of the review period EUR 805 thousand of bank account credit
limit was used. The company’s operations are on a solid foundation, and it is the management’s view that the company
has the capacity to overcome the negative impacts caused by the Russian invasion of Ukraine on its business operations.
Proposal of the Board of Directors on the Disposal of Profit for the Financial Year
At the end of financial year 2022, the distributable equity of the Group's parent company is 16,436,538.92 euros. Solteq
Plc's Board of Directors proposes to the Annual General Meeting that for the financial year 2022, no dividend will be
paid out.
The Board of Directors is of the opinion that there are no financial prerequisites for dividend pay-outs, or other kind of
distribution of funds. According to the terms and conditions of the company debenture stock distribution of funds would
lead to the expiration of the credit. The covenants of the bond do not permit distribution of funds based on the financial
year 2022.
No essential changes have taken place in the company's financial situation after the end of the financial year.
Corporate Governance Statement
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Documentation on administration and governance structure is given as a separate report attached to the annual report.
Statement of Non-Financial Information
Statement of non-financial information is given as a separate report attached to the annual report.
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Key Figures
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Key Figures of the Group
Key figures outlining the group's financial
development
2022
2021
2020
2019
2018
Revenue, MEUR
68.4
69.1
60.5
58.3
56.9
Change in revenue, %
-0.9
14.2
3.7
2.5
12.1
Operating result, MEUR
-4.4
7.1
5.4
5.7
2.5
% of revenue
-6.4
10.3
8.9
9.8
4.3
Result before taxes, MEUR
-6.6
5.2
2.7
3.7
0.6
% of revenue
-9.6
7.6
4.5
6.3
1.1
Return on equity, %
-21.4
15.0
7.8
12.1
1.7
Return on investment, %
-6.9
13.0
9.1
10.4
5.2
Equity ratio, %
30.3
36.9
35.5
32.0
32.4
Net investments in non-current assets, MEUR
9.2
7.1
5.5
4.6
8.3
% of revenue
13.5
10.3
9.0
7.9
14.6
Research and development costs, MEUR
3.7
2.8
3.0
3.9
2.3
% of revenue
5.4
4.1
5.0
6.7
4.0
Net debt, MEUR
31.4
25.9
26.5
31.5
22.9
Gearing, %
139.4
92.6
99.9
128.5
105.1
Average number of employees over the
financial period
676
637
593
597
567
Group's key figures per share
2022
2021
2020
2019
2018
Earnings per share, EUR
-0.28
0.21
0.10
0.15
0.02
Equity per share, EUR
1.16
1.44
1.37
1.27
1.13
Dividends per share, EUR
0.00
0.00
0.15
0.00
0.00
Dividend from result, %
0.0
0.0
146.3
0.0
0.0
Effective dividend yield, %
0.0
0.0
5.4
0.0
0.0
Price–earnings ratio (P/E)
-4.4
22.1
27.3
10.3
70.1
Highest share price, EUR
4.94
7.16
3.7
1.65
1.64
Lowest share price, EUR
1.15
2.56
0.96
1.27
1.26
Average share price, EUR
2.81
5.08
1.95
1.44
1.49
Market value of the shares, TEUR
23,858
90,776
54,058
28,767
25,098
Shares trade volume, 1,000 pcs
13,024
25,148
6,720
808
827
Shares trade volume, %
67.1
129.7
34.8
4.2
4.3
Weighted average of the share issue
corrected number of shares during the
financial period, 1,000 pcs
19,397
19,382
19,307
19,307
19,202
Number of shares corrected by share issue at
the end of the financial period, 1,000 pcs
19,397
19,397
19,307
19,307
19,202
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Calculation of the Key Figures
Return on Equity (ROE), %:
Profit for the financial period (rolling 12 months)
x 100
Equity (average for the period)
Return on investment (ROI), %:
Profit before taxes + Finance expenses (rolling 12 months)
x 100
Balance sheet total - Interest free debt (average for the period)
Equity ratio, %:
Equity
x 100
Balance sheet total - Advances received
Net debt:
Interest bearing liabilities - Cash and cash equivalents
Gearing, %:
Interest bearing liabilities - Cash and cash equivalents
x 100
Equity
Earnings per share:
Profit before taxes -/+ Minority interest
Adjusted average basic number of shares
Diluted earnings per share:
Profit before taxes -/+ Minority interest
Adjusted diluted average number of shares
Equity per share:
Equity
Number of shares
Dividend per share:
Dividend for the period
Number of shares at the year-end
Dividend from result, %:
Dividend per share
x 100
Earnings per share
Effective dividend yield:
Dividend per share
x 100
Share price at the year-end
Price-earnings (P/E) ratio:
Share price at the year-end
x 100
Earnings per share
The market value of Company's shares:
The number of shares at the year-end x Share price at the year-end
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EBITDA:
Operating result + Depreciations and impairments
Share of recurring revenue of the total revenue of Solteq Software segment:
Recurring revenue / SaaS
Total revenue of Solteq Software segment
Alternative Performance Measures to be Used by Solteq Group in Financial Reporting
Solteq uses alternative performance measures to describe the Company’s underlying financial performance and to
improve the comparability between review periods. The alternative performance measures should not be regarded as
indicators that replace the financial key figures as defined in IFRS standards.
Performance measures used by Solteq Group are EBITDA, equity ratio, gearing, return on equity, return on investment,
and net debt. The calculation principles of these financial key figures are presented above, Calculation of the key figures.
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Items Affecting Comparability:
Transactions that are unrelated to the regular business operations, or valuation items that do not affect the cash flow,
but have an important impact on the income statement, are adjusted as items that affect comparability. These non-
recurring items may include the following:
• Significant restructuring arrangements and related financial items
• Impairments
• Items related to the sale or discontinuation of significant business operations
• Costs incurred by the re-organization of operations
• Costs incurred by the integration of acquired business operations
• Non-recurring severance packages
• Fee items that are not based on cash flow
• Costs incurred by changes in legislation
• Fines and similar indemnities, damages, and legal costs
Comparable EBITDA and Operating Profit (EBIT)
2022
2021
TEUR
Solteq
Digital
Solteq
Software
Group
Solteq
Digital
Solteq
Software
Group
Comparable EBITDA*
5,759
641
6,400
7,969
4,587
12,556
Comparable EBITDA, %
13.7
2.4
9.4
18.0
18.5
18.2
Operating profit (EBIT)
3,228
-7,633
-4,406
5,563
1,560
7,123
Items affecting comparability
Acquisition costs
124
124
189
189
Cost of integrating the acquired business
24
24
7
7
Non-recurring severance packages
111
53
164
28
39
68
Fines and similar indemnities and damages
29
29
Impairments
16
4,432
4,448
Costs incurred by the re-organization of operations
353
152
506
25
25
Total items affecting comparability
480
4,814
5,293
53
236
289
Comparable operating profit (EBIT)
3,707
-2,820
888
5,617
1,795
7,412
Comparable operating profit, %
8.8
-10.7
1.3
12.7
7.3
10.7
* The reconciliation of the comparable operating profit to operating profit is presented in the table. The same adjusting
items apply when reconciling the comparable EBITDA to EBITDA, excluding Impairments.
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Financial Statements
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Consolidated Financial Statements
Consolidated Statement of Comprehensive Income
TEUR
Notes
1 Jan 2022 -
31 Dec 2022
1 Jan 2021 -
31 Dec 2021
Revenue
2.1, 2.2
Other income
2.4
Materials and services
-7,550
-7,903
Employee benefit expenses
2.3
-44,560
-40,312
Other expenses
2.4, 2.5
-10,928
-8,685
Depreciations and impairments
3.4
-9,960
-5,144
Operating profit
-4,406
Financial income
2.6
Financial expenses
2.6
-2,672
-2,235
Profit before taxes
-6,574
Income taxes
2.7
-1,145
Profit for the financial period
-5,404
Other comprehensive income to be reclassified to profit or loss in subsequent periods
Currency translation differences
-61
-46
Other comprehensive income, net of tax
-61
-46
Total comprehensive income
-5,465
Earnings per share attributable to equity holders of the parent
Earnings per share, EUR (undiluted)
-0.28
Earnings per share, EUR (diluted)
-0.28
Result for the financial year and total comprehensive income belong exclusively to the owners of the Parent Company.
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Consolidated Statement of Financial Position
TEUR
Notes
31 Dec 2022
31 Dec 2021
Assets
Non-current assets
Tangible assets
3.1
Right-of-use assets
3.2
Intangible assets
Goodwill
3.3
Other intangible assets
3.3
Other investments
5.3
Deferred tax assets
2.7
Trade and other receivables
4.1
Non-current assets total
Current assets
Inventories
4.2
Trade and other receivables
4.1
Cash and cash equivalents
5.4
Current assets total
Total assets
Equity and liabilities
Equity attributable to equity holders of the parent company
Share capital
5.5
Share premium reserve
5.5
Distributable equity reserve
5.5
Retained earnings
Total equity
Non-current liabilities
Deferred tax liabilities
2.7
Financial liabilities
5.2
Lease liabilities
5.2
Non-current liabilities total
Current liabilities
Financial liabilities
5.2
Trade and other payables
4.3
Provisions
4.4
Lease liabilities
5.2
Current liabilities total
Total liabilities
Total equity and liabilities
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Consolidated Cash Flow Statement
TEUR
Notes
1 Jan 2022 -
31 Dec 2022
1 Jan 2021 -
31 Dec 2021
Cash flow from operating activities
Profit for the financial period
-5,404
Adjustments for operating profit
2.9
Changes in working capital
Interests paid
-1,854
-1,772
Interests received
Net cash flow from operating activities
Cash flow from investing activities
Business acquisitions
-5,109
-2,855
Investments in tangible and intangible assets
-3,454
-3,064
Net cash used in investing activities
-8,563
-5,920
Cash flow from financing activities
Long-term loans, decrease
5.2
-8
Short-term loans, increase
5.2
Short-term loans, decrease
5.2
-1,194
Payment of lease liabilities
5.2
-2,465
-2,415
Dividend payment
-2,909
Net cash used in financing activities
-5,325
Changes in cash and cash equivalents
-1,531
-1,289
Cash and cash equivalents at the beginning of period
Cash and cash equivalents at the end of period
5.4
Cash and cash equivalents presented in the cash flow statement consist of the
following items:
TEUR
2022
2021
Cash and cash equivalents
Total
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Consolidated Statement of Changes in Equity
TEUR
Share
capital
Share
premium
account
Invested
unrestricted
equity
reserve
Currency
translation
difference
Retained
earnings
Total
Equity 1 Jan 2021
-99
Profit for the financial period
Other items on comprehensive
income
-46
-46
Total comprehensive income
-46
Transactions with owners
Returned dividends
Dividends paid
-2,909
-2,909
Share issue
Transactions with owners
-2,909
-2,559
Equity 31 Dec 2021
-144
Equity 1 Jan 2022
-144
Result for the financial period
-5,404
-5,404
Other items on comprehensive
income
-61
-61
Total comprehensive income
-61
-5,404
-5,465
Equity 31 Dec 2022
-205
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Notes to Consolidated Financial Statements
1. GENERAL INFORMATION
1.1 Group Information
Solteq is a Nordic provider of IT services and software solutions specializing in the digitalization of business and industry-
The Group’s Parent Company is Solteq Plc public limited company
whose shares are quoted on Nasdaq Helsinki Ltd. The Company is domiciled in Vantaa, Finland
www.solteq.com or from the headquarters in Vantaa.
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2. FINANCIAL RESULT
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3. TANGIBLE AND INTANGIBLE ASSETS
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4. OPERATIONAL ASSETS AND LIABILITIES
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5. CAPITAL STRUCTURE AND FINANCIAL ITEMS
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Below is the reconciliation of the number of shares:
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The reserves included in equity are as follows:
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6. OTHER NOTES
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Parent Company Financial Statements
Parent Company’s Statement of Comprehensive Income
TEUR
Notes
1 Jan 2022 -
31 Dec 2022
1 Jan 2021 -
31 Dec 2021
Revenue
1.1
56,449
58,755
Other income
1.3
897
638
Materials and services
-8,623
-8,936
Employee benefit expenses
1.2
-35,613
-32,852
Other expenses
1.3, 1.4
-8,847
-7,247
Depreciations and impairments
2.4
-9,090
-4,322
Operating result
-4,827
6,038
Financial income
1.5
52
41
Financial expenses
1.5
-2,046
-1,742
Result before taxes
-6,821
4,337
Income taxes
1.6
1,291
-945
Result for the financial period
-5,529
3,391
Total comprehensive income
-5,529
3,391
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Parent Company’s Statement of Financial Position
TEUR
Notes
31 Dec 2022
31 Dec 2021
Assets
Non-current assets
Tangible assets
2.1
45
216
Right-of-use assets
2.2
2,097
3,419
Intangible assets
2.3
Goodwill
1,991
1,991
Other intangible assets
46,020
45,323
Other investments
4.3
453
453
Shares in subsidiaries
5.1
8,644
8,063
Deferred tax assets
1.6
1,306
Trade and other receivables
3.1
636
983
Non-current assets total
61,192
60,448
Current assets
Inventories
3.2
133
207
Trade and other receivables
3.1
10,750
9,877
Cash and cash equivalents
4.4
869
1,403
Current assets total
11,753
11,487
Total assets
72,945
71,935
Equity and liabilities
Equity attributable to equity holders of the parent company
Share capital
4.5
1,009
1,009
Share premium reserve
4.5
75
75
Distributable equity reserve
4.5
14,374
14,374
Retained earnings
8,182
13,711
Total equity
23,640
29,170
Non-current liabilities
Deferred tax liabilities
1.6
507
389
Financial liabilities
4.2
24,179
24,217
Lease liabilities
4.2
939
2,129
Non-current liabilities total
25,624
26,735
Current liabilities
Financial liabilities
4.2
5,928
Trade and other payables
3.3
16,609
14,530
Provisions
3.4
78
73
Lease liabilities
4.2
1,065
1,426
Current liabilities total
23,680
16,030
Total liabilities
49,304
42,765
Total equity and liabilities
72,945
71,935
Annual Report 2022
81
Parent Company’s Cash Flow Statement
TEUR
Notes
1 Jan 2022 -
31 Dec 2022
1 Jan 2021 -
31 Dec 2021
Cash flow from operating activities
Result for the financial period
-5,529
3,391
Adjustments for operating profit
1.8
9,007
5,657
Changes in working capital
1,228
787
Interests paid
-1,749
-1,655
Interests received
48
38
Net cash flow from operating activities
3,005
8,219
Cash flow from investing activities
Business acquisitions
-5,291
-2,000
Investments in tangible and intangible assets
-3,116
-2,715
Net cash used in investing activities
-8,407
-4,715
Cash flow from financing activities
Short-term loans, increase
4.2
6,813
Short-term loans, decrease
4.2
-1,008
Payment of lease liabilities
4.2
-1,902
-1,872
Dividend payment
-2,909
Net cash used in financing activities
3,903
-4,782
Changes in cash and cash equivalents
-1,500
-1,278
Cash and cash equivalents at the beginning of period
1,403
2,681
Cash and cash equivalents transferred in the merger
966
Cash and cash equivalents at the end of period
4.4
869
1,403
Cash and cash equivalents presented in the cash flow statement consist of the following items:
TEUR
2022
2021
Cash and cash equivalents
869
1,403
Total
869
1,403
Annual Report 2022
82
Parent Company’s Statement of Changes in Equity
TEUR
Share
capital
Share
premium
account
Invested
unrestricted
equity
reserve
Retained
earnings
Total
Equity 1 Jan 2021
1,009
75
14,024
13,229
28,338
Total comprehensive income
3,391
3,391
Transactions with owners
Returned dividends
0
0
Dividends paid
-2,909
-2,909
Share issue
350
350
Transactions with owners total
0
0
350
-2,909
-2,559
Equity 31 Dec 2021
1,009
75
14,374
13,711
29,170
Equity 1 Jan 2022
1,009
75
14,374
13,711
29,170
Total comprehensive income
-5,529
-5,529
Equity 31 Dec 2022
1,009
75
14,374
8,182
23,640
Annual Report 2022
83
Notes to Solteq Plc Financial Statements
Accounting policies for the parent company’s Financial Statements
Solteq Plc’s consolidated financial statements have been prepared in accordance with the International Financial
Reporting Standards (IFRS) complying with the IAS and IFRS standards as well as the SIC and IFRIC interpretations valid
as at December 31, 2022. International Financial Reporting Standards mean the standards and their interpretations that
have been approved for adoption in the EU in accordance with the procedure No. 1606/2002 enacted in the Finnish
Accounting Act and EU (EC) regulations laid down by the Act. The notes to the consolidated financial statements are
also in accordance with the requirements of the Finnish Accounting and Companies legislation.
The Group accounting policies are applied to both the Group financial statements as well as the Parent Company
financial statements, unless otherwise mentioned.
1. FINANCIAL RESULT
1.1 Revenue from Contracts with Customers
TEUR
2022
2021
Services
43,698
48,433
Recurring revenue / SaaS
7,861
6,140
Software and hardware sales
4,889
4,182
Total
56,449
58,755
Contract Balances
TEUR
2022
2021
Trade and other receivables
8,279
8,376
Contract assets
387
500
Contract liabilities
-556
-517
Contract Assets
TEUR
2022
2021
Contract assets on Jan 1
500
240
Transfers from contract assets to receivables
-433
-172
Increases as a result of changes in the measure of progress
321
432
Contract assets on Dec 31
387
500
Annual Report 2022
84
Contract Liabilities
TEUR
2022
2021
Contract liabilities on Jan 1
-517
-203
Revenue recognized from contract liabilities
465
163
Increases due to cash received, excluding amounts recognized as revenue during the
period
-504
-476
Contract liabilities on Dec 31
-556
-517
The Company expects to meet a significant part of outstanding performance obligations during the reporting period
2023.
1.2 Employee Benefit Expenses
TEUR
2022
2021
Salaries and wages
29,566
27,494
Pension expenses - defined contribution plan
5,008
4,428
Other personnel expenses
1,039
930
Total
35,613
32,852
Average number of employees over the financial period
508
487
Information on management’s employee benefits is presented in note 5.1 Related party transactions.
1.3 Other Income and Expenses
Other Income
TEUR
2022
2021
Government grants
1
55
Income resulting from the sales of assets and business operations
81
Other income
104
65
From Group companies, compensation for administration costs
711
517
Total
897
638
Annual Report 2022
85
Other expenses
TEUR
2022
2021
Telephone and telecommunication costs
612
549
Voluntary personnel expenses
583
479
Rental and other office related expenses
1,427
1,180
Hardware and software expenses
1,630
1,440
Car and travel expenses
361
169
External services
3,026
2,579
Bad debts
55
2
Warranty provisions
5
12
Other expenses
1,149
836
Total
8,847
7,247
Lease Expenses
TEUR
2022
2021
Depreciation of right-of-use assets
1,725
1,856
Interest expense from lease contracts
126
169
Costs from short-term lease contracts
20
26
Costs from low-value asset lease contracts
802
624
Total
2,672
2,675
Auditor’s Fees
TEUR
2022
2021
Auditing
101
97
Certificates and statements
7
10
Tax consulting
11
16
Other services
74
41
Total
193
164
The non-audit services charged by KPMG Oy Ab from Solteq Plc in the financial year 2022 were EUR 85 thousand (57).
1.4 Research and Development Costs
The income statement includes a total of EUR 542 thousand (176) of research and development costs recognized as
expense in 2022.
Annual Report 2022
86
1.5 Financial Income and Expenses
Financial Income
TEUR
2022
2021
Interest income
45
35
Foreign currency exchange income
4
2
Dividend income
3
3
Total
52
41
Financial Expenses
TEUR
2022
2021
Interest expenses from financial expenses in amortized costs
1,610
1,505
Interest expense on lease liabilities
126
169
Foreign currency exchange expenses
16
7
Other financial expenses
295
61
Total
2,046
1,742
For the financial year 2022, EUR 198 thousand in other financial expenses were related to the fees for changing the
terms of the bond.
1.6 Income Taxes
Income taxes
TEUR
2022
2021
Tax based on the taxable income for the period
3
1,041
Taxes from previous periods
11
Deferred taxes
-1,294
-107
Total
-1,291
945
TEUR
2022
2021
Result before taxes
-6,821
4,337
Taxes based on domestic tax rate
-1,364
867
Non-deductible expenses
31
18
Exempt from taxes
-1
Revaluation of deferred taxes
-8
-15
Other items
50
64
Taxes from previous periods
11
Taxes on the income statement
-1,291
945
Annual Report 2022
87
Deferred Tax Assets and Liabilities
Changes in deferred taxes:
TEUR
1 Jan
2021
Recognized
on the
income
statement
Acquisition
of
subsidiaries
and
businesses
31 Dec
2021
Recognized
on the
income
statement
Acquisition
of
subsidiaries
and
businesses
31 Dec
2022
Deferred tax assets:
Provisions
12
2
15
1
16
Postponed depreciations
4
33
38
9
47
From the loss of the financial period
1,244
1,244
Other items
14
-2
12
-12
0
Netted with deferred tax liabilities
-31
-64
0
Total
0
34
0
0
1,242
0
1,306
Deferred tax liabilities:
Tax-deductible goodwill
0
78
78
94
172
Allocated intangible liabilities
365
-137
90
317
-153
106
270
Other items
72
-14
58
7
64
Netted with deferred tax assets
-31
-64
0
Total
406
-151
168
389
-53
106
507
For the financial year 2022, the parent company's loss has been booked in full as a deferred tax asset, as it is likely that
taxable income will be generated in the future against which it can be utilized.
1.7 Earnings per Share
2022
2021
Profit for the financial period attributable to equity holders of the parent company
(TEUR)
-5,529
3,391
Weighted average of the number of shares during the financial period (1 000)
19,397
19,382
Undiluted EPS (EUR/share)
-0.29
0.17
There were no diluting factors during the financial year 2022 nor the comparison period 2021.
1.8 Adjustments to Cash Flow from Business Operations
Significant events are listed in the cash flow statement. Significant adjustments to cash flow from business operations
are due to depreciations and impairments made during the financial period, EUR
9 090 thousand (4,322).
Annual Report 2022
88
2. TANGIBLE AND INTANGIBLE ASSETS
2.1 Tangible Assets
TEUR
Machinery
and
equipment
Other
tangible
assets
Prepayments
Total
Acquisition cost 1 Jan 2022
2,473
21
56
2,550
Additions
12
12
Disposals
-106
-21
-56
-182
Acquisition cost 31 Dec 2022
2,379
1
0
2,380
Accumulated depreciation and impairment 1 Jan 2022
2,335
0
0
2,335
Depreciation
94
94
Accumulated depreciation on disposals
-94
-94
Accumulated depreciation and impairment 31 Dec
2022
2,335
0
0
2,335
Book value 1 Jan 2022
138
21
56
216
Book value 31 Dec 2022
44
1
0
45
Acquisition cost 1 Jan 2021
2,473
21
56
2,550
Acquisition cost 31 Dec 2021
2,473
21
56
2,550
Accumulated depreciation and impairment 1 Jan 2021
2,144
0
0
2,144
Depreciation
191
191
Accumulated depreciation and impairment 31 Dec
2021
2,335
0
0
2,335
Book value 1 Jan 2021
329
21
56
406
Book value 31 Dec 2021
138
21
56
216
Annual Report 2022
89
2.2 Right-of-Use Assets
TEUR
Premises
Machinery
and
equipment
Right-of-Use
assets total
Acquisition cost 1 Jan 2022
6,786
6,495
13,281
Additions *
702
196
898
Disposals
-269
-227
-496
Acquisition cost 31 Dec 2022
7,220
6,464
13,683
Accumulated depreciation and impairment 1 Jan 2022
4,072
5,790
9,862
Depreciation
1,519
205
1,725
Accumulated depreciation and impairment 31 Dec 2022
5,592
5,995
11,587
Book value 1 Jan 2022
2,714
705
3,419
Book value 31 Dec 2022
1,628
469
2,097
Acquisition cost 1 Jan 2021
6,453
6,485
12,938
Additions *
333
162
495
Disposals
-152
-152
Acquisition cost 31 Dec 2021
6,786
6,495
13,281
Accumulated depreciation and impairment 1 Jan 2021
2,648
5,358
8,006
Depreciation
1,424
432
1,856
Accumulated depreciation and impairment 31 Dec 2021
4,072
5,790
9,862
Book value 1 Jan 2021
3,805
1,126
4,932
Book value 31 Dec 2021
2,714
705
3,419
* Includes changes to lease contracts
Solteq applies the reliefs allowed by IFRS 16 for short-term agreements and low-value commodities per agreement. See
the table below for the minimum leases payable based on these lease agreements:
TEUR
2022
2021
Within a year
737
742
More than one year
730
785
Total
1,468
1,527
2.3 Intangible Assets
Accounting Policy
In the balance sheet of the Parent Company, under the immaterial rights section, there are merger losses, which are not
depreciated evenly. These are instead tested as goodwill by performing impairment tests.
In the Parent Company, the transaction is handled at book value as for companies under mutual control.
Annual Report 2022
90
TEUR
Payments in
advance and
uncompleted
actions
Goodwill
Development
costs
Intangible
rights
Other
intangible
assets
Total
Acquisition cost 1 Jan 2022
4,307
4,356
8,898
44,703
401
62,665
Merger of the subsidiary
4,546
4,546
Additions
3,208
65
61
3,334
Disposals
-4,360
-1
-4,361
Transfers between items
-2,520
2,520
0
Acquisition cost 31 Dec 2022
634
4,356
11,483
49,309
401
66,184
Accumulated amortization and impairment 1
Jan 2022
2,365
4,303
8,281
401
15,350
Amortization
1,695
1,128
2,823
Accumulated amortization on disposals
-1
-1
Accumulated amortization and impairment
31 Dec 2022
2,365
5,998
9,409
401
18,172
Book value 1 Jan 2022
4,307
1,991
4,595
36,422
0
47,315
Book value 31 Dec 2022
634
1,991
5,485
39,900
0
48,011
Acquisition cost 1 Jan 2021
3,608
2,365
7,152
44,183
401
57,709
Merger of the subsidiary
1,991
448
2,440
Additions
2,444
72
2,516
Transfers between items
-1,746
1,746
0
Acquisition cost 31 Dec 2021
4,307
4,356
8,898
44,703
401
62,665
Accumulated amortizations and impairment 1
Jan 2021
0
2,365
3,099
7,210
401
13,075
Amortization
1,204
1,071
2,275
Accumulated amortization and impairment
31 Dec 2021
0
2,365
4,303
8,281
401
15,350
Book value 1 Jan 2021
3,608
0
4,053
36,973
0
44,634
Book value 31 Dec 2021
4,307
1,991
4,595
36,422
0
47,315
In the financial year 2022, a total of EUR 182 thousand (563) government grants related to the acquisition of intangible
assets were received.
Impairment
The goodwill values related to business combinations are allocated to the cash-generating units which are based on the
Group’s budgeting and reporting structure, and which are smallest independent entities with separate cash flows. The
content of the cash-generating units is in line with the Group’s segment structure.
The book value of the goodwill and merger loss in the Parent Company on 31 December 2022 was EUR 40 144 thousand
(36,128). At the end of the financial period, in the Parent Company there were investments in progress in development
projects of a value of EUR 634 thousand (4,307).
Annual Report 2022
91
Impairment tests have been carried out at the cash-generating unit level. The recoverable amount has been determined
by means of the value in use. The determined anticipated cash flows are based on the operating profit budget for 2023
and operating profit forecasts for the subsequent four years.
The discount rate of 12,31 percent used in the calculations is the weighted average cost of capital after taxes (equals
15.4 percent before taxes).
Based on testing performed in 2022, no need was found for recognizing impairment losses: a clear margin was left for
each tested unit. No impairment losses were recognized in 2022 related to the goodwill of the group or to merger losses
of the Parent Company. During the review period, Solteq Plc wrote off EUR 4,418 thousand in product development
costs relating to the Solteq Robotics business.
Goodwill and Merger Losses of Tested Units that Generate Cash Flow
TEUR
2022
2021
Solteq Digital
24,261
24,261
Solteq Software
15,883
11,867
Total
40,144
36,128
Development costs in progress have been tested with use value calculations. The expected return has been discounted
to present value. The interest rate used in the calculations is 12.31 percent after tax. Based on the calculations, there is
no need for write-down in the financial year.
Sensitivity Analysis
A summary of unit-specific sensitivities is below:
• In Solteq Software segment, there will be need for write-downs, if the operating profit decreases by 2.2 percentage
units or the discount rate increases by 1.5 percentage units.
• In Solteq Digital segment, there will be need for write-downs, if the operating profit decreases by 6.9 percentage
units or the discount rate increases by 7.8 percentage units.
Annual Report 2022
92
2.4 Depreciation, Amortization, and Impairment
TEUR
2022
2021
Depreciations by asset group
Intangible assets
Development costs
1,695
1,204
Intangible rights
1,128
1,071
Total
2,823
2,275
Tangible assets
Machinery and equipment
94
191
Right of use asset depreciation
1,725
1,856
Total
1,819
2,047
Impairments*
4,449
0
Total depreciations and impairments
9,090
4,322
* Mainly related to the write-offs of the Solteq Robotics business
3. OPERATIONAL ASSETS AND LIABILITIES
3.1 Trade and Other Receivables
TEUR
2022
2021
Trade receivables
6,189
6,727
Contract assets
387
500
Accrued income
2,099
1,021
Receivables from Group companies
2,695
2,608
Other receivables
17
4
Total
11,386
10,861
Contract assets are related to ongoing long-term projects which are recognized based on rate of completion. Significant
items included in prepayments and accrued income relate to normal business accruals.
The Aging of Accounts Receivable and Items Recorded as Impairment Losses:
TEUR
2022
Impairment
losses
Net
2022
Probability
of losses
Presumed
losses
2021
Impairment
losses
Net
2021
Probability
of losses
Presumed
losses
Not due
6,448
6,448
7,039
7,039
Due
2,274
-55
2,218
53
1,839
-2
1,837
54
Under 30 days
698
698
1,096
1,096
31-60 days
361
361
312
312
61-90 days
316
316
324
324
More than 90 days
899
-55
844
6.3
53
107
-2
105
51.4
54
Total
8,721
-55
8,666
53
8,878
-2
8,876
54
Annual Report 2022
93
All current receivables are denominated in euros. There are no significant concentrations of risk related to receivables.
Historically there has not been significant impairment losses. The balance sheet values correspond to the maximum
amount of credit risk. Because the receivables are current their fair value is equivalent to carrying value.
3.2 Inventories
TEUR
2022
2021
Finished goods
133
207
Total
133
207
3.3 Trade and Other Payables
TEUR
2022
2021
Trade payables
3,416
4,566
Accruals and deferred income
7,835
6,815
Other liabilities
4,371
2,850
Liabilities to Group companies
987
300
Total
16,609
14,530
Current liabilities are denominated in euros and their fair values equal their book values. Significant items included in
accruals and deferred income relate to usual accruals for business operations. Withheld taxes for paid wages and
salaries, social security payments and other social security related items to be accounted for in connection with tax
withholding, as well as VAT liability are disclosed in other payables.
3.4 Provisions
TEUR
Warranty provisions
Total
31 Dec 2021
73
73
Additional provisions
5
5
31 Dec 2022
78
78
Warranty provisions
Warranty provision is recorded for long-term projects based on anticipated warranty work. The general warranty period
is 6 – 12 months. The warranty provisions are based on the historical information on the amount of warranty obligations.
The warranty provisions are expected to be used during the next financial period.
4. CAPITAL STRUCTURE AND FINANCIAL ITEMS
4.1 Financial Risk Management and Capital Management
Solteq Plc, the Group's parent company, is responsible for managing the Group's financial risks and capital. The Group's
information is presented in note 5.1. The parent company's information is in line with the Group's.
Annual Report 2022
94
4.2 Financial Assets and Liabilities
TEUR
2022
Book value
2022
Fair value
2021
Book value
2021
Fair value
Financial liabilities at amortized cost
Non-current
Bond
22,839
22,839
22,755
22,755
Loans from financial institutions
1,340
1,340
1,463
1,463
Lease liabilities
939
939
2,129
2,129
Total
25,118
25,118
26,346
26,346
Current
Loans from financial institutions
5,928
5,928
Lease liabilities
1,065
1,065
1,426
1,426
Total
6,993
6,993
1,426
1,426
The fair value of the financial liabilities is mainly the same as the book value.
Financial liabilities, including finance lease liabilities and the interest rate swap are categorized at fair value level 2.
Cash Flow Notes: Non-Cash Flow Related Changes
TEUR
31 Dec
2021
Cash flows
Transfer
from non-
current to
current
New
financial
lease
contracts
*)Other
changes
31 Dec
2022
Non-current liabilities
24,217
-123
84
24,179
Current liabilities
0
5,805
123
5,928
Lease liabilities
3,555
-1,902
898
-547
2,004
Total financing liabilities
27,772
3,903
0
898
-462
32,111
*) The cumulative effective interests during the financial period, which are valuated to the acquisition costs and
disposals of the lease liabilities.
Maturity of Financial Leases:
TEUR
Book
value
Contractual
cash flows
1-12
months
13-24
months
25-36
months
Later
Financial liabilities, Dec 31 2022
Bond
22,839
25,766
1,383
24,383
Loans from financial institutions
1,463
1,525
95
414
359
657
Annual Report 2022
95
Lease liabilities
2,004
2,033
1,135
769
124
5
Trade payables
4,403
4,403
4,403
Financial liabilities total
30,709
33,727
7,016
25,566
483
663
Financial liabilities, Dec 31 2021
Bond
22,755
27,149
1,383
1,383
24,383
Loans from financial institutions
1,463
1,537
12
95
414
1,017
Lease liabilities
3,555
3,498
1,539
1,035
839
85
Trade payables
4,866
4,866
4,866
Financial liabilities total
32,638
37,050
7,800
2,513
25,636
1,102
In 2022, the average interest rate of the loans was 6.0 percent (6.0). All financial liabilities are denominated in euros.
On October 1, 2020, Solteq issued a fixed rate bond with a nominal value of EUR 23.0 million. Annual interest of 6.0
percent is paid on the bond, and it will mature on October 1, 2024. The bond can be redeemed before its final maturity
date.
In the fourth quarter of 2022, efforts were also made to ensure the flexibility of financing for the current financial year.
The company initiated a written procedure to amend the terms and conditions of its EUR 23 million senior unsecured
fixed rate notes. Due to the approved amendments to the terms and conditions, the working capital facility was
increased from EUR 7 million to EUR 10 million. The increased flexibility in financing is a good thing for the company,
although we strive to develop our business in a way that doesn’t require additional debt.
4.3 Other Investments
TEUR
2022
2021
Beginning of financial period
453
455
Change
-2
End of financial period
453
453
The item includes unquoted shares. Fair value is estimated to correspond to book value (fair value hierarchy level 3).
4.4 Cash and Cash Equivalents
TEUR
2022
2021
Cash and cash equivalents
869
1,403
Total
869
1,403
4.5 Equity
TEUR
Number of
shares
(1 000)
Share
capital
Share
premium
reserve
Invested
unrestricted
equity
reserve
Total
Annual Report 2022
96
Beginning of financial period
19,397
1,009
75
14,374
15,458
End of financial period
19,397
1,009
75
14,374
15,458
4.6 Conditional Debts and Liabilities
TEUR
2022
2021
Collateral given on our own behalf
Business mortgages
10,000
10,000
Total
10,000
10,000
Until the issuance of the bond the business mortgages as well as the pledged shares are given as collateral by the Parent
Company for credit limits and long-term loans.
Annual Report 2022
97
5. OTHER NOTES
5.1 Related Party Transactions
Solteq Group’s related parties include the Board of Directors, the CEO, and the Group’s Executive Team, as well as their
related parties and entities according to the IAS24 standard.
On December 31, 2022, Solteq Plc owned the following subsidiaries:
Company
Domicile
Share of ownership (%)
Share of votes (%)
S2B Energia Oy
Finland
100 %
100 %
Solteq Robotics Oy
Finland
100 %
100 %
Aponsa AB
Sweden
100 %
100 %
Solteq Poland Sp. z. o. o
Poland
100 %
100 %
Solteq Digital UK Ltd
Great Britain
100 %
100 %
Solteq Denmark A/S
Denmark
100 %
100 %
There were no related party transactions to be reported in the review or the comparison period.
Management Employee Benefits
TEUR
2022
2021
Salaries and other short-term employment benefits
1,127
1,106
Total
1,127
1,106
The compensations of CEO, the Board of Directors and the Executive Team are included in the management employee
benefits.
Wages and Salaries of the Members of the Board of Directors and CEO
Parent Company
TEUR
2022
2021
CEO Olli Väätäinen until Jan 31, 2022
58
313
Interim CEO Kari Lehtosalo during Feb 1 - Jun 30, 2022
114
CEO Aarne Aktan from Jul 1, 2022
175
Board members
Markku Pietilä, Chairman of the Board
64
45
Aarne Aktan until Jun 30, 2022
20
26
Lotta Kopra until Mar 24, 2022
8
26
Panu Porkka
33
25
Katarina Segerståhl
37
26
Mika Uotila until May 17, 2021
12
Anni Sarvaranta from Mar 24, 2022
26
Mika Sutinen from Mar 24, 2022
25
Annual Report 2022
98
The CEO’s accrual-based pension costs amount to EUR 90 thousand. The CEO’s pension plan complies with the
employment pension legislation. The CEO’s notice period is six months and the agreement does not include any separate
severance payments.
Solteq Plc’s members of the Board of Directors and CEO owned directly or through controlled companies 26 thousand
(328) shares at the end of 2022.
5.2 Business Combinations
During the financial year 2022, the Parent Company made two acquisitions.
On January 3, 2022, Solteq Plc signed an agreement to purchase the entire share capital of the energy software company
Enerity Solutions Oy. Through the acquisition, Solteq is expanding its software offering in the utilities sector, which is
one of the company’s key growth drivers in the Nordic market. The deal also further increases the company’s expertise
in the changing operating environment of the energy sector. Enerity Solutions specializes in software solutions for
electricity trading and grid profitability and risk management. Enerity Solutions Oy was merged into the parent company
on June 1, 2022.
Solteq Plc acquired on November 7, 2022, the entire share capital of energy sector system and service provider S2B
Energia Oy. As a result of the acquisition 10 employees transferred to be part of Solteq Group. The debt-free purchase
price was EUR 1 and net assets EUR 32 thousand.
During the financial year 2021, one acquisition was made.
Solteq Plc acquired Partiture Oy’s professional services business, specializing in utilities sector. The agreement was
effective as of March 1, 2021. The utilities sector is one of the Solteq’s key drivers for growth in the Nordic market. As
a result of the business transfer agreement, 16 experts transferred to Solteq. The debt-free purchase price of the
transfer was EUR 2,350 thousand.
EUR 350 thousand of the business acquisition purchase price was paid for with new Solteq shares measured at fair value,
based on the authorization given to the Board, by the Annual General Meeting on June 10, 2020 and the rest of the
purchase price with existing cash funds. EUR 1,000 thousand of the purchase price was paid at the time of signing the
agreement, and the rest was paid on December 15, 2021.
The business transfer agreement created an intangible asset related to the customer contracts transferred to Solteq Plc
with the agreement. In addition, goodwill of EUR 1,991 thousand, which consists of non-separable assets, such as
synergies, competent personnel, and market share, was recognized for the transaction. The goodwill is tax-deductible.
A total of EUR 64 thousand of expenses related to the business transfer agreement were recognized in other operating
expenses.
Annual Report 2022
99
TEUR
2021
Intangible assets
448
Total assets
448
Deferred tax liabilities
90
Total liabilities
90
Net assets acquired
359
Total consideration
2,350
Goodwill
1,991
Impact on cash flows
Paid in cash
2,000
Cash flow from investing activities
-2,000
Consideration
Paid in cash
2,000
Directed issue
350
Total
2,350
5.3 The Russian invasion of Ukraine and its impact on Financial Reporting
The Russian invasion of Ukraine and its impact to the financial reporting of the Parent Company is the same as that to
the Group. The information as regards the Group is presented in the Group note 6.4.
5.4 Events After the Balance Sheet Date
The Parent Company’s events after the balance sheet date are the same as those of the Group. The information as
regards the Group is presented in the Group note 6.5.
Annual Report 2022
100
Proposal for Distribution of Profits and Signatures
The distributable equity of the Parent Company Solteq Plc as at 31 December 2022 is:
The distributable equity
31 Dec 2022
31 Dec 2021
Invested unrestricted equity reserve
14,374,181.33
14,374,181.33
Result for previous financial periods
13,711,364.54
10,320,045.98
Result for the financial year
-5,529,399.15
3,391,318.56
Total non-restricted equity
22,556,146.72
28,085,545.87
Capitalized development costs
-6,119,607.80
-8,901,305.71
Total distributable funds
16,436,538.92
19,184,240.16
At the end of financial year 2022, the distributable equity of the Group's parent company is 16,436,538.92 euros. Solteq
Plc's Board of Directors proposes to the Annual General Meeting that for the financial year 2022, no dividend will be
paid out.
The Board of Directors is of the opinion that there are no financial prerequisites for dividend pay-outs, or other kind of
distribution of funds. According to the terms and conditions of the company debenture stock distribution of funds would
lead to the expiration of the credit. The covenants of the bond do not permit distribution of funds based on the financial
year 2022.
No essential changes have taken place in the company's financial situation after the end of the financial year.
Annual Report 2022
101
Signatures to the Report of the Board of Directors and the Financial Statements
Vantaa, February 15, 2023
Markku Pietilä Mika Sutinen
Chairman of the Board Board Member
Anni Sarvaranta Panu Porkka
Board Member Board Member
Katarina Segerståhl
Board Member
Aarne Aktan
CEO
Auditor’s note
Our auditors’ report has been issued today.
Helsinki, February 15, 2023
KPMG Oy Ab
Petri Sammalisto
Authorized Public Accountant
Annual Report 2022
102
This document is an English translation of the Finnish auditor’s report. Only the Finnish version of the report is legally binding.
Auditor’s Report
To the Annual General Meeting of Solteq Plc
Report on the Audit of the Financial Statements
Opinion
We have audited the financial statements of Solteq Plc (business identity code 0490484-0) for the year ended 31
December 2022. The financial statements comprise both the consolidated and the parent company’s statement of
financial position, statement of comprehensive income, statement of changes in equity, statement of cash flows and
notes, including a summary of significant accounting policies.
In our opinion the financial statements give a true and fair view of the group’s and parent company’s financial
performance, financial position and cash flows in accordance with International Financial Reporting Standards (IFRS) as
adopted by the EU and comply with statutory requirements.
Our opinion is consistent with the additional report submitted to the Audit Committee.
Basis for Opinion
We conducted our audit in accordance with good auditing practice in Finland. Our responsibilities under good auditing
practice are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our
report.
We are independent of the parent company and of the group companies in accordance with the ethical requirements
that are applicable in Finland and are relevant to our audit, and we have fulfilled our other ethical responsibilities in
accordance with these requirements.
In our best knowledge and understanding, the non-audit services that we have provided to the parent company and
group companies are in compliance with laws and regulations applicable in Finland regarding these services, and we
have not provided any prohibited non-audit services referred to in Article 5(1) of regulation (EU) 537/2014. The non-
audit services that we have provided have been disclosed in note 2.4 to the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Materiality
The scope of our audit was influenced by our application of materiality. The materiality is determined based on our
professional judgement and is used to determine the nature, timing and extent of our audit procedures and to evaluate
the effect of identified misstatements on the financial statements as a whole. The level of materiality we set is based
on our assessment of the magnitude of misstatements that, individually or in aggregate, could reasonably be expected
to have influence on the economic decisions of the users of the financial statements. We have also taken into account
misstatements and/or possible misstatements that in our opinion are material for qualitative reasons for the users of
the financial statements.
Annual Report 2022
103
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
financial statements of the current period. These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
The significant risks of material misstatement referred to in the EU Regulation No 537/2014 point (c) of Article 10(2) are
included in the description of key audit matters below.
We have also addressed the risk of management override of internal controls. This includes consideration of whether
there was evidence of management bias that represented a risk of material misstatement due to fraud.
THE KEY AUDIT MATTER
HOW THE MATTER WAS ADDRESSED IN THE
AUDIT
Goodwill and merger loss impairment assessment (Accounting principles, consolidated
financial statements note 3.3 and parent company’s financial statement note 2.3)
— In recent years the Group has expanded its
activities through acquisition of companies.
As a result, the consolidated statement of
financial position includes a significant
amount of goodwill. Due to merging the
acquired companies to the parent company,
there is a significant amount of merger
losses in the parent company’s other
intangible assets.
— Goodwill and merger loss in parent
company’s statement of financial position
are not amortized but are tested at least
annually for impairment.
— Determining the cash flow forecasts
underlying the impairment tests requires
management judgments and estimates
especially relating to revenue growth rate,
profitability, discount rate and long-term
growth rate.
— Due to the high level of judgement related
to the forecasts used, and the significant
carrying amounts involved, impairment
assessment of goodwill and merger loss is
considered a key audit matter.
— We assessed the impairment tests prepared
by the company.
— Our audit work with the involvement of
KPMG valuation specialists included testing
the integrity of the calculations and the
technical model.
— We assessed the assumptions used by
management in respect of forecasted
revenue growth rates and profitability as
well as the appropriateness of the discount
rates used. In addition, we validated the
assumptions used in relation to market and
industry information.
— We evaluated the cash flows used by
comparing them to the group’s budgets and
the understanding we gained from our audit.
— Furthermore, we have considered the
appropriateness of the disclosures related to
Group’s goodwill, parent company’s merger
loss and impairment testing.
Revenue recognition (Accounting principles and consolidated financial statements note 2.2)
Annual Report 2022
104
— The consolidated revenue comprise
different revenue flows based on different
contract types, such as services, software
license sales and maintenance as well as
projects.
— The company has projects in which the
satisfaction of the performance obligation is
monitored throughout the project delivery.
Revenue recognition based on satisfaction
of performance obligation involves
management judgment and estimates
especially on forecasted total costs of the
project and resources needed.
— Due to the analyses of different contract
terms and conditions associated with the
choice of a revenue recognition method as
well as management judgement involved,
revenue recognition is considered a key
audit matter.
— We assessed group’s revenue recognition
principles in relation to IFRS standards.
— Our audit procedures included evaluation of
internal control environment over revenue
recognition and testing of operating
effectiveness of key internal controls. In
addition, we performed substantive testing
to assess appropriateness of revenue
recognition and recording revenue in the
correct period.
— In addition, we assessed the
appropriateness of recognition of project
revenue prepared by the company and
evaluated company’s process to identify
potential provisions related to these
projects.
— Furthermore, we considered the
appropriateness of the disclosures in
respect of revenue recognition principles
and net sales.
Responsibilities of the Board of Directors and the Managing Director for the Financial Statements
The Board of Directors and the Managing Director are responsible for the preparation of consolidated financial
statements that give a true and fair view in accordance with International Financial Reporting Standards (IFRS) as
adopted by the EU, and of financial statements that give a true and fair view in accordance with the laws and regulations
governing the preparation of financial statements in Finland and comply with statutory requirements. The Board of
Directors and the Managing Director are also responsible for such internal control as they determine is necessary to
enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors and the Managing Director are responsible for assessing
the parent company’s and the group’s ability to continue as going concern, disclosing, as applicable, matters relating to
going concern and using the going concern basis of accounting. The financial statements are prepared using the going
concern basis of accounting unless there is an intention to liquidate the parent company or the group or cease
operations, or there is no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of Financial Statements
Our objectives are to obtain reasonable assurance on whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with good auditing
practice will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial statements.
As part of an audit in accordance with good auditing practice, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
Annual Report 2022
105
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to
provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for
one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
Obtain an understanding of internal control relevant to the audit 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 parent
company’s or the group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
disclosures made by management.
Conclude on the appropriateness of the Board of Directors’ and the Managing Director’s use of the going concern basis
of accounting and based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the parent company’s or the group’s ability to continue as a going concern.
If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related
disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may
cause the parent company or the group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and
whether the financial statements represent the underlying transactions and events so that the financial statements give
a true and fair view.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities
within the group to express an opinion on the consolidated financial statements. We are responsible for the direction,
supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during
our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most
significance in the audit of the financial statements of the current period and are therefore the key audit matters. We
describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because
the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such
communication.
Annual Report 2022
106
Other Reporting Requirements
Information on our audit engagement
Solteq Plc became a public interest entity on 6 September 1999. We have been the company’s auditors since it became
a public interest entity.
Other Information
The Board of Directors and the Managing Director are responsible for the other information. The other information
comprises the report of the Board of Directors and the information included in the Annual Report, but does not include
the financial statements and our auditor’s report thereon. We have obtained the report of the Board of Directors prior
to the date of this auditor’s report, and the Annual Report is expected to be made available to us after that date.
Our opinion on the financial statements does not cover the other information.
In connection with our audit of the financial statements, our responsibility is to read the other information identified
above and, in doing so, consider whether the other information is materially inconsistent with the financial statements
or our knowledge obtained in the audit, or otherwise appears to be materially misstated. With respect to the report of
the Board of Directors, our responsibility also includes considering whether the report of the Board of Directors has
been prepared in accordance with the applicable laws and regulations.
In our opinion, the information in the report of the Board of Directors is consistent with the information in the financial
statements and the report of the Board of Directors has been prepared in accordance with the applicable laws and
regulations.
If, based on the work we have performed on the other information that we obtained prior to the date of this auditor’s
report, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Helsinki, 15 February 2023
KPMG OY AB
PETRI SAMMALISTO
Authorised Public Accountant, KHT
Annual Report 2022
107
Independent Auditor’s Reasonable Assurance Report on Solteq Plc’s ESEF Financial Statements
To the Board of Directors of Solteq Plc
We have undertaken a reasonable assurance engagement in respect of whether the consolidated financial statements
for the year ended 31 December, 2022 included in the digital financial statements 743700HXWTM31ZHBXW13-2022-
12-31-en.zip of Solteq Plc (Business ID 0490484-0) have been marked up with iXBRL markups in accordance with the
requirements of Article 4 of EU Delegated Regulation 2018/815 (ESEF RTS).
The Responsibility of the Board of Directors and Managing Director
The Board of Directors and Managing Director are responsible for preparing the report of the Board of Directors and
financial statements (ESEF financial statements) that comply with the requirements of ESEF RTS. This responsibility
includes:
— preparation of ESEF financial statements in XHTML format in accordance with Article 3 of the ESEF RTS
— marking up the primary statements and the notes to the consolidated financial statements, and the company
identification data included in the ESEF financial statements with iXBRL tags in accordance with Article 4 of the ESEF
RTS; and
— ensuring consistency between ESEF financial statements and audited financial statements.
The Board of Directors and the Managing Director are also responsible for such internal control as they deem necessary
to prepare the ESEF financial statements in accordance with the requirements of the ESEF RTS.
Auditor’s Independence and Quality Management
We are independent of the company in accordance with the ethical requirements applicable in Finland, which apply to
the engagement we have performed, and we have fulfilled our other ethical responsibilities in accordance with these
requirements.
The auditor applies International Standard on Quality Management ISQM 1, which requires the firm to design,
implement and operate a system of quality management including policies or procedures regarding compliance with
ethical requirements, professional standards and applicable legal and regulations requirements.
Auditor’s Responsibility
In accordance with the Engagement Letter our responsibility is to express an opinion on whether the marking up of the
consolidated financial statements included in the ESEF financial statements comply in all material respects with the
Article 4 of the ESEF RTS. We conducted our reasonable assurance engagement in accordance with International
Standard on Assurance Engagements 3000.
The engagement involves procedures to obtain evidence whether;
— the primary statements of the consolidated financial statements included in the ESEF financial statements are, in
all material respects, marked up with iXBRL tags in accordance with Article 4 of the ESEF RTS, and;
— whether the notes to the consolidated financial statements and the company identification data included in the
ESEF financial statements data, have been marked up, in all material respects, with iXBRL tags in accordance with
Article 4 of the ESEF RTS; and
— whether the ESEF financial statements and the audited financial statements are consistent with each other.
Annual Report 2022
108
The nature, timing and the extent of procedures selected depend on practitioner’s judgement. This includes the
assessment of the risks of material departures from the requirements set out in the ESEF RTS, whether due to fraud or
error.
We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Opinion
In our opinion, the primary statements of the consolidated financial statements, the notes to the consolidated financial
statements and the company identification data included in the ESEF financial statements of Solteq Plc identified as
743700HXWTM31ZHBXW13-2022-12-31-en.zip for the year ended 31 December, 2022 are, in all material respects,
marked up in compliance with the ESEF Regulatory Technical Standard.
Our audit opinion on the audit of the consolidated financial statements of Solteq Plc for the year ended 31 December,
2022 is set out in our Auditor’s Report dated 15 February, 2023. In this report, we do not express any audit opinion or
other assurance conclusion on the consolidated financial statements.
Helsinki 6 March, 2023
KPMG OY AB
Petri Sammalisto
Authorised Public Accountant, KHT
Vuosikertomus 2020
109
Statement of Non-Financial
Information
Annual Report 2022
110
Corporate Responsibility at Solteq
Solteq provides software solutions and IT expert services to the energy sector, retail industry, and the
needs related to e-commerce. The Company employs over 650 professionals and serves its customers
in the Nordic countries. The company has offices in Finland, Sweden, Norway, Denmark, Poland, and the
UK.
Responsibly produced solutions and operating with a high degree of ethics as a service provider,
employer, partner, and corporate citizen are a precondition for successful business and strong
stakeholder relations.
Solteq’s Code of Conduct is based on the Company’s operating principles concerning anti-bribery and
corruption, human resource management, sustainable development, environmental responsibility,
information security, and data protection. In addition to the Company’s internal guidelines, the
operations are guided by local legislation, regulations, instructions, standards issued by authorities, and
international principles governing ethical business, human rights, and social responsibility.
Material Aspects of Responsibility
Solteq has defined the key aspects of its corporate responsibility based on the economic, social, and
environmental impacts of its business. The Company also evaluates corporate responsibility from the
perspective of industry-specific trends and phenomena.
Solteq’s corporate responsibility is focused on four aspects:
• social responsibility and respecting human rights,
• data protection and information security,
• anti-corruption and bribery, and
• environmental responsibility.
Areas especially relevant to Solteq’s operations are matters related to the wellbeing of personnel and
ensuring the confidentiality of information, and the integrity of information systems. The Company has a
zero-tolerance policy for bribery and corruption. Responsible practices ensure that sustainability and
environmental aspects are taken into account – considering the extent and nature of the Company’s
operations.
Stakeholders
Solteq’s key stakeholders are the Group’s personnel, customers, partners, shareholders, and the
authorities. The impacts of Solteq’s operations on these stakeholders has been comprehensively
assessed when preparing the corporate responsibility principles. Solteq engages in active dialogue with
its various stakeholders regarding the realization and development of responsible operating methods.
Responsibility in Customer Relationships
Solteq helps customers find solutions that suit their needs, are technologically up to date and offer a high
level of information security. Customer satisfaction is actively monitored.
The principles governing quality management in customer projects are defined in Solteq’s quality plan.
The goal of instructions and guidelines related to quality planning, assurance, control, and improvement
Annual Report 2022
111
is to ensure the high-quality execution of customer projects and the achievement of the agreed
objectives.
Risk Management System
The Group’s risk management is guided by legal requirements, regulations and instructions given by
authorities, other rules and standards binding the Company, business requirements set by the
Company’s shareholders and the expectations of other stakeholders. The goal of risk management is to
identify and acknowledge the risks involved in the Company’s operations as well as to make sure that the
risks are appropriately managed when making business decisions. The Company’s risk management
supports the achievement of strategic goals and ensures the continuity of business operations.
Risk management is aimed at ensuring that the risks affecting the Company’s business are identified,
managed, and monitored. To ensure that responsible practices are implemented, the Company has
recognized and is systematically monitoring certain areas, such as:
• risks pertaining to employees and working, such as those related to discrimination, working conditions
and equal pay,
• risks related to information security and privacy, particularly phishing, data breaches or other leaks of
personal data,
• risks related to corruption and bribery, particularly with respect to the supply chain and customer
relationships, and
• risk factors related to the Company’s reputation and stakeholders’ trust in the Company, such as
changes in the operation of the Company or its partners, and any accidents, crises affecting the
environment and the personnel, and negative publicity. The Company is prepared to communicate in a
timely and clear manner in case of any crisis, emergency, and disruption to maintain the stakeholders’
trust in the Company. The Company has an up-to-date crisis communication plan, and crisis
communication has been invested in by organizing crisis communication training to the personnel.
Management of Corporate Responsibility
Corporate responsibility issues are regularly discussed by the Executive Team and Board of Directors.
The CEO is responsible for reporting on corporate responsibility.
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112
Social Responsibility
Personnel and Human Rights
Highly competent, motivated, and healthy employees are the foundation for Solteq’s success. Hence,
the Company’s operations are largely built on the core values (integrity, dedication, better together)
defined together with the employees. A strong foundation of values in operations aims for a good
employee experience and positive customer experience as a result.
IT is a rapidly evolving industry, and Solteqians are eager to continuously develop their skills. To enable
this, the employees are regularly offered opportunities for training. In 2022, the training focused on
improving the employees’ technical competencies and the team leaders’ leadership skills.
Well-being at work is managed as part of the Company’s business operations. Well-being at work is
supported by, among other things, flexible working hours, remote work opportunities, and extensive
sports, culture, and well-being initiatives.
Success in recruitment has a strategic significance for the growing and evolving company. In 2022, the
Company recruited 159 new employees (147). Personnel turnover was at 25 percent (19). High employee
mobility is typical in the industry, and the availability of skilled workforce is a significant risk for business
operations.
Employee satisfaction is measured by a survey conducted three times per year. The survey results are
used in assigning priorities to Company-specific development projects as well as to supporting
managerial work. Employer recommendation (eNPS) decreased to 27 (31). The decreased work
satisfaction reflected the difficulties in resource sufficiency and in the development of software products.
Solteq strives to be a flexible employer that values equality and diversity. Employees are treated equally
regardless of their gender, ethnicity, religious beliefs, age, and other such factors. Unlike many software
companies, Solteq’s personnel has a wide age range. The Company’s employees include fresh graduates
as well as experienced professionals approaching retirement age. The average age of the personnel was
40.9 years (40.9). Women accounted for 24,5 percent of Solteq’s personnel (22).
Solteq respects internationally recognized human rights and workers’ rights and nurtures a safe and
healthy work environment for all its employees. The fundamental principles of Solteq’s personnel
management have been defined in the Personnel and Training Plan and the Occupational Health and
Safety Plans. According to the Company’s view, there are no significant risks of human rights
infringements associated with its operations. Possible risks of human rights infringements are related to
the supply chain. These risks are managed by choosing business partners carefully and by obligating the
partners to commit to the responsibility principles drawn by Solteq or other equivalent principles of
responsible practice.
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113
Data Protection and Information Security
The confidentiality of data and the integrity of information systems are at the core of Solteq’s efforts
related to information security. It is crucial for Solteq to protect the privacy of its stakeholders and the
appropriate handling of confidential data.
Solteq’s company-level IT operations, covering data security practices, control systems, and risk
management, were granted ISO/IEC 27001:2013 certification in 2019. The certification requires that the
Company continuously develops its data security and data protection. The certification was renewed in
December 2022. The auditor for the certification was KPMG IT Sertifiointi Oy. No significant
shortcomings were found.
In terms of personal data, Solteq operates in the market in the roles of both controller and data processor.
The Company’s data protection practices are publicly available. Solteq processes personal data in
compliance with legislation and only collects personal data when necessary.
Solteq gives guidance and instructions to its customers regarding appropriate technical and
organizational measures, which contributes to the protection of privacy in society. During 2022, Solteq
has been involved in the implementation of information security and data protection as part of its
customer projects. The emphasis has been on identity protection, the development of risk and
vulnerability management of delivered customer solutions, and the capability to protect against global
data security threats, such as cyberattacks. Solteq has taken particular precautions on the increased
cybersecurity threats.
The prevention and communication of information security threats are managed by an established
Security Incident Reporting process, which ensures that the relevant parties are informed of potential or
actual security incidents. With this process, Solteq aims to ensure efficiency in handling information
security incidents. Solteq is involved in the Digipooli project led by the National Emergency Supply
Agency. Digipooli is a trust network between businesses and public authorities that supports and
promotes digital security in society and secures operating conditions for disturbances and exceptional
situations. Solteq participated in the nationwide TIETO22 exercise, organized by the National
Emergency Supply Agency, which simulated the cooperation between businesses and authorities in
major cyber incidents.
Solteq’s employees’ information security skills are maintained through regular and mandatory
information security trainings. Solteq employees receive information security training already as part of
the orientation. Extended data protection and information security training to the entire personnel was
introduced in the spring of 2019. Approximately 80 percent of the employees completed the Information
Security and Data Protection training in 2022.
Solteq’s information security and data protection operations are managed by an information security
team consisting of IT Director, Data Protection Officer, Chief Information Security Officer responsible for
the information security of the business solutions, and two Enterprise Architects. The information
security team is responsible for the information security of infrastructure services and enterprise
resource planning. In addition, the Chief Information Security Officer in charge of information security in
business solutions works closely with the business units and looks after the development of information
security and data protection in the Company’s IT solutions.
Annual Report 2022
114
Anti-Corruption and Bribery
Solteq does not condone bribery or corruption in any form. The Company requires compliance with anti-
bribery principles as well as the principles governing business transparency in all of its operations.
Solteq chooses its partners carefully and all payments are subject to appropriate approval using a pre-
defined phased approval process and they must be recorded in the Company’s accounts. The Company
does not pay or approve of any questionable benefits. All benefits provided and received must be such
that they can be openly reported to everyone. The Company is committed to transparency in all its
business operations.
Solteq’s Board of Directors has approved the Company’s Anti-Corruption and Bribery Policy and its
principles in 2016. The policy complements Solteq’s Code of Conduct. In addition, Solteq requires its
suppliers and partners to commit to the Company’s ethical principles or corresponding principles
pertaining to corporate responsibility.
Solteq’s stakeholders are primarily domestic and Nordic entities. The Company’s business takes place
in regions where the risk for corruption and bribery is low. Solteq assesses partnership risks on a case-
by-case basis and requests additional accounts and clarifications, when necessary, based on the
partnership risk assessment.
Solteq has a whistleblowing channel to enable anonymous reporting and following up on the processing
of notifications of suspected misconduct. The Company is committed to processing all reports
confidentially and in accordance with a standard process. Solteq complies with the EU Whistleblowing
Directive and national legislation. No suspected incidents of misconduct were reported in 2022.
Annual Report 2022
115
Environmental Responsibility
The ICT sector is estimated to account for 3–5 percent of global greenhouse gas emissions. According
to the climate and environmental strategy for the ICT sector, published by the Ministry of Transport and
Communications in 2021, reducing energy consumption, using renewable energy sources, and managing
life cycle of raw materials are essential to reducing emissions. In addition, development of green software
solutions creates new opportunities for a more climate and environment friendly industry.
Solteq takes environmental aspects into consideration in its operations according to Solteq’s policy for
sustainability and environmental responsibility. Consideration for the climate is being further
emphasized in Solteq’s responsible practices, and the development will be guided by the measurement
and monitoring of carbon dioxide emissions launched in 2021.
Carbon Footprint Directs Towards Better Tomorrows
In 2022, Solteq Plc’s CO
2
emissions were assessed in accordance with the international Greenhouse Gas
Protocol (GHG), taking into account the key emission sources for the Company’s direct and indirect
operations.
In 2022, the entire value chain carbon footprint of Solteq Group was 1,120 tonnes CO
2
e.
• Scope 1 covers direct emissions resulting from the Group’s operations. These include carbon
dioxide emissions from the consumption of fossil fuels by leased cars. Scope 1 emissions accounted
for 2.7 percent of Solteq’s total emissions.
• Scope 2 covers indirect emissions resulting from the Group’s operations. These include carbon
dioxide emissions from electricity, heating, and cooling of the Company’s premises and the leased
electric vehicles. Scope 2 emissions accounted for 19.6 percent of Solteq’s total emissions.
• Scope 3 covers indirect emissions resulting from the Group’s operations. These include the carbon
dioxide emissions from business travel – flights, train travel, and car journeys which are reimbursed
–equipment and capacity purchases, and commuting. Scope 3 emissions accounted for 77.6
percent of Solteq’s total emissions.
In 2022, the carbon footprint of Solteq Group’s own operations was 384 tonnes CO
2
e. Carbon emissions
from commuting and equipment and capacity purchases are not included in the calculation.
In 2022, CO
2
emissions of the Group’s own operations increased by 8.0 percent relative to the
comparison period. This was mainly due to an increase in business travel as it bounced closer to the pre-
pandemic levels.
The greatest potential for reducing carbon dioxide emissions lies in favoring premises and capacity
utilizing renewable energy sources. Restraint in business travel also helps to mitigate carbon emissions,
as do remote and hybrid work. In the future, direct carbon emissions can be reduced by favoring electric
and hybrid cars in leasing contracts.
Annual Report 2022
116
Carbon Footprint of Solteq Group’s Own Operations
2020
2021
2022
Change
2021–2022 - %
Carbon footprint of own
operations, tCO
2
e
387
356
384
7.9
CO
2
emissions relative to
revenue, kg CO
2
e / TEUR
6.4
5.2
5.6
8.0
CO
2
emissions per employee,
tCO
2
e
0.7
0.6
0.6
0.7
Green Choices as Part of Daily Work
Solteq strives to reduce the environmental impact of business premises and equipment as well as
increase the recycling of materials. The Company favors modern, energy-efficient, and healthy
environments in its choices of business premises. Centrally located offices, the use of modern
communication technology and remote work opportunities aim to reduce the need for travelling. The
Company continues to favor sustainable means of travel, whenever team meetings and other face-to-
face meetings are organized.
A significant proportion of the industry’s environmental impacts arises from hardware manufacturing.
Solteq takes this into account in its purchase practices, by favoring energy efficiency, life cycle and
reliability of hardware. Network and information system hardware and phones are mostly purchased from
well-known and certified suppliers. Equipment that has reached the end of its life cycle is collected in
WEEE collection containers at Solteq’s offices to be recycled and used as raw material for
electronics. Solteq conducts dialogue with different equipment suppliers in order to support sustainable
principles.
EU Taxonomy
The EU Taxonomy is a classification system for sustainable finance that aims to support the transition
towards an economy based on low carbon emissions, resource efficiency, and sustainable development.
Through the classification system, EU is steering capital market financing towards sustainable targets,
as well as steering companies operating in those markets towards more transparent reporting and
responsible business practices. The sectors included in the classification system are those with the
greatest potential to meet the EU’s climate change mitigation and adaptation goals.
Solteq has assessed its suitability and alignment for the EU Taxonomy classification system for 2021 and
2022. The Company’s core business operations do not correspond to activities that contribute to climate
change mitigation or adaptation as these are defined by the classification system for the information,
communications, and technology sector. As a result, 0 percent of Solteq’s business operations come
within the scope of economic activities that are suitable for or aligned with the classification system.
Solteq continues its efforts in sustainability and is preparing to extend its sustainability reporting in 2025.
Annual Report 2022
117
Economic activities
Codes
Revenue
Share of
revenue
Climate change
mitigation
Climate change
adaptation
Water and
marine
resources
Circular
economy
Pollution
Biodiversity and
ecosystems
Climate change
mitigation
Climate change
adaptation
Water and
marine
resources
Circular
economy
Pollution
Biodiversity and
ecosystems
Minimum
safeguards
2022 2021
Category
MEUR %
% % % % % %
Y/N Y/N Y/N Y/N Y/N Y/N Y/N % % E/T
TAXONOMY-ELIGIBLE ACTIVITIES
Taxonomy-aligned activities
Revenue of Taxonomy -aligned activ ities 0 0 0 0
Taxonomy-non-aligned activities
Revenue of Taxonomy -non-aligned activities 0 0 0 0
Total Taxonomy-eligible activities 0 0 0 0
TAXONOMY-NON-ELIGIBLE ACTIVITIES
Revenue of Taxonomy -non-eligible activ ities 68,4 100
Total Taxonomy-eligible and non-eligible
rev enue
68,4
100
Substantial contribution criteria
DNSH criteria
Taxonomy-
aligned
share of
revenue
Economic activities
Codes
Revenue
Share of
revenue
Climate change
mitigation
Climate change
adaptation
Water and
marine
resources
Circular
economy
Pollution
Biodiversity and
ecosystems
Climate change
mitigation
Climate change
adaptation
Water and
marine
resources
Circular
economy
Pollution
Biodiversity and
ecosystems
Minimum
safeguards
2022 2021
Category
MEUR %
% % % % % %
Y/N Y/N Y/N Y/N Y/N Y/N Y/N % % E/T
TAXONOMY-ELIGIBLE ACTIVITIES
Taxonomy-aligned activities
CapEx of Taxonomy-aligned activ ities 0 0 0 0
Taxonomy-non-aligned activities
CapEx of Taxonomy-non-aligned activities 0 0 0 0
Total Taxonomy-eligible activities 0 0 0 0
TAXONOMY-NON-ELIGIBLE ACTIVITIES
CapEx of Taxonomy-non-eligible activities 9,2 100
Total Taxonomy-eligible and non-eligible CapEx 9,2 100
Substantial contribution criteria
DNSH criteria
Taxonomy-
aligned
share of
revenue
Economic activities
Codes
Revenue
Share of
revenue
Climate change
mitigation
Climate change
adaptation
Water and
marine
resources
Circular
economy
Pollution
Biodiversity and
ecosystems
Climate change
mitigation
Climate change
adaptation
Water and
marine
resources
Circular
economy
Pollution
Biodiversity and
ecosystems
Minimum
safeguards
2022 2021
Category
MEUR %
% % % % % %
Y/N Y/N Y/N Y/N Y/N Y/N Y/N % % E/T
TAXONOMY-ELIGIBLE ACTIVITIES
Taxonomy-aligned activities
OpEx of Taxonomy-aligned activities 0 0 0 0
Taxonomy-non-aligned activities
OpEx of Taxonomy-non-aligned activities 0 0 0 0
Total Taxonomy-eligible activities 0 0 0 0
TAXONOMY-NON-ELIGIBLE ACTIVITIES
OpEx of Taxonomy-non-eligible activities 73,0 100
Total Taxonomy-eligible and non-eligible OpEx 73,0 100
Taxonomy-
aligned
share of
revenue
Substantial contribution criteria
DNSH criteria
Annual Report 2022
118
Solteq’s Corporate Responsibility Priorities, Objectives, and Key Performance Indicators
Aspect
Principles and processes
Objective
Performance indicators
2022
2021
2020
Most significant risks
Anti-corruption
and Bribery
Anti-corruption and
bribery policy, engaging
the commitment of
employees and partners,
whistleblowing channel
Commitment of
employees and other
stakeholders
Number of reported
infringements
0
0
0
Criminal and other legal sanctions
Impacts on customer relationships
and public procurement
Reputation risk
Management of
identified risks
Several online trainings
are organized for
personnel in connection
with the risk factors
identified during the
year. Topics include data
security and protection,
crisis communication,
and prevention of
corruption and bribery.
Personnel training
and effective
prevention of risks
Annual mandatory
trainings attended by
the staff
584
530
520
Risks related to data protection and
information security
Risk factors related to the
Company’s reputation
Personnel
A culture of sharing
knowledge, working
together and
experimenting
Development of
leadership and
managerial work
Performance reviews
and competence
management
Competitive benefits
Rising trend in employee
satisfaction
Solteq is a sought-
after workplace with
healthy and satisfied
employees. The
Company supports
competence
development,
provides an equal and
non-discriminatory
workplace community
and supports
individual wellbeing.
Positive employee
experience
Employer
recommendation score
27
31
38
Risks related to the availability of
employees
Environmental
Responsibility
Measurement and
analysis of carbon
footprint
Life Cycle Management,
%
Mitigation of the
Company's carbon
emissions
tCO
2e
384
100
356
100
387
100
Climate change related risks
Reputation risk
Solteq Plc
Karhumäenkuja 2
01530 Vantaa