quarterly report q1 2016. · 2019. 2. 14. · cash flow. cash flow for the first quarter was...
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QUARTERLY REPORTQ1 2016.
CONTENT
BIRDSTEP TECHNOLOGY ASA INTERIM REPORT 3CEO UPDATE 4RESULT OF OPERATION 6CASH FLOW 7SUBSEQUENT EVENT 8FINANCIAL STATEMENTS 9NOTES 14DISCONTINUED OPERATIONS 15RISKS 17FINANCIAL CALENDAR 2016 18
QUARTERLY REPORT Q1 20162
CONTENT
QUARTERLY REPORT Q1 20163
BIRDSTEP TECHNOLOGY ASA INTERIM REPORT.
BIRDSTEP TECHNOLOGY ASA INTERIM REPORT.
KEY FIGURES JANUARY - MARCH 2016
> �The�financial�figures�presented�below�are�excluding�Birdstep�Technology�AB�due�to�discontinued�operations. > Revenue�was�NOK�0.0�(0.1)�million. > �EBITDA�ended�at�NOK�-5.0�(-8.9)�million,�representing�a�decreased�loss�of�NOK�3.9�million�over�the�same�
period�last�year.� > �Continuing�operating�earnings�per�share�amounted�to�NOK�-0.40�(-0.30). > �Total�net�cash�flow�amounted�to�NOK�13.4�(-2.3)�million. > �Cash�balance�was�NOK�20.0�(14,4)�million�after�cash�and�cash�equivalents�classified�as�held�for�sale.
HIGHLIGHTS FIRST QUARTER 2016
> �Signed�share�purchase�agreement�for�sale�of�all�shares�in�Birdstep�Technology�AB�to�Smith�Micro�Software�Inc�for�USD�2.0�million�free�of�cash�and�net�debt.�
> Letter�of�intent�signed�with�Middelborg�AS�to�pursue�the�possibility�of�a�merger�between�Birdstep�and�� �������subsidiary�of�Middelborg�into�which�Middelborg�will�place�its�ownership�interests�in�Teki�Solutions.
> Letter�of�intent�signed�with�Smith�Micro�Software�Inc�with�the�aim�to�be�granted�certain�rights�to�distribute��� �������and�utilize�Smith�Micro’s�products,�and�principle�agreement�signed�with�Teki�Solutions�to�be�the�qualified��partner.
> A�share�consolidation�was�carried�out�in�the�ratio�of�10:1. > Private�placement�of�3,400,000�shares�to�Middelborg�Invest�for�a�consideration�of�NOK�7.48�million,�increasing�total��
�������number�of�shares�in�Birdstep�to�13,562,163. > Ingrid�Leisner�and�Tore�Traaseth�was�appointed�to�the�Board�of�Directors. > Lonnie�Schilling�will�step�down�from�his�position�as�the�Company’s�CEO�after�a�notice�period�of�six�months�starting�
�������1�April.
SUBSEQUENT EVENTS
> �The�sale�of�all�shares�in�Birdstep�Technology�AB�to�Smith�Micro�Software�Inc�was�finalized�7�April.
QUARTERLY REPORT Q1 20164
CEO UPDATE
CEO UPDATE.
I�am�very�pleased�that�the�transaction�was�approved�by�the�shareholders�at�the�extraordinary�general�meeting�on�31�March�followed�by�the�finalization�of�the�sale�on�7�April.�It�has�been�a�rocky�road�for�Birdstep�ever�since�it�was�founded�20�years�ago.�The�company�has�operated�in�a�very�exciting,�dynamic�but�also�transforming,�competi-tive�and�sometimes�difficult�market.�Despite�our�high�tech�technology�and�continuing�efforts�to�reach�new�market�opportunities�we�finally�faced�challenges�that�
required�rapid�adjustments�throughout�2015�and�into�2016.�After�we�lost�our�main�revenues�with�Sprint�in�No-vember�2015,�accounting�for�87�%�of�total�revenue�2015,�the�financial�outlook�became�critical.�We�had�no�other�choice�than�to�intensify�our�efforts�to�look�for�strategic�alternatives�in�order�to�avoid�further�difficulties.��I�be-lieve�that�the�transaction�with�SMSI�can�secure�a�future�for�both�the�technology�and�the�majority�of�Birdstep’s�employees�under�the�ownership�of�SMSI.
IN THE FIRST QUARTER OF 2016 BIRDSTEP TECHNOLOGY ASA (BIRDSTEP) ENTERED INTO AN AGREEMENT TO SELL ITS WHOLLY OWNED SUBSIDIARY BIRDSTEP TECHNOLOGY AB (“BIRDSTEP AB”) TO SMITH MICRO SOFTWARE, INC. (SMSI) FOR USD 2.0 MIL-LION ON CASH FREE NET DEBT BASIS.
QUARTERLY REPORT Q1 20165
CEO UPDATE
For�Birdstep�a�number�of�actions�to�create�value�for�its�shareholders�has�already�started;
Firstly;�Concurrently�with�the�entering�of�the�agree-ment�for�the�sale�of�Birdstep�AB,�Birdstep�and�SMSI�entered�into�a�letter�of�intent�with�the�aim�that�Birdstep�shall�be�granted�certain�rights�to�distribute�and�utilise�SMSI`s�products�(including�the�products�of�Birdstep�AB)�in�the�Nordic�markets�in�cooperation�with�a�qualified�partner.�Secondly;�Birdstep�has�furthermore�entered�into�a�principal�terms�agreement�with�Teki�Solutions�AS,�with�the�aim�that�Teki�Solutions�shall�be�appointed�as�BIRD’s�qualified�partner�in�the�cooperation�with�SMSI�and�that�Birdstep�and�Teki�Solutions�shall�share�the�profits�from�the�cooperation�with�SMSI�on�a�50/50�profit�split�basis.�
Thirdly;�On�March�8�Birdstep�completed�a�private�placement�directed�at�Middelborg�Invest�AS,�the�company’s�single�largest�shareholder.�The�Private�Placement�comprises�3,400,000�shares,�each�with�a�nominal�value�of�NOK�1.00,�at�a�subscription�price�per�share�of�NOK�2.20,�resulting�in�gross�cash�proceeds�to�Birdstep�of�NOK�7.48�million.�
Fourthly;�On�March�8�Birdstep�also�entered�into�a�letter�of�intent�with�Middelborg�AS�to�pursue�the�pos-sibility�of�a�merger�between�Birdstep�and�MergerCo,�a�subsidiary�of�Middelborg,�to�be�established.�It�is�the�intention�to�conclude�a�merger�agreement�during�the�second�quarter�of�2016.�This�will�be�subject�to�the�ap-proval�of�the�shareholders�at�a�general�meeting.
I�am�satisfied�that�we,�with�the�sale�of�Birdstep�AB,�managed�to�avoid�financial�difficulties�and,�as�part�of�the�deal�with�SMSI,�have�good�possibilities�to�cre-ate�a�strong�industrial�partnership�that�could�create�value�for�Birdstep’s�shareholders�going�forward.�Teki�Solutions�has�a�number�of�high�quality�customer�and�supplier�relationships�where�Birdstep’s�and�SMSI’s�technology�has�an�interesting�potential.�Teki�Solu-tions�also�has�access�to�product�development�forums�which�Birdstep,�as�an�independent�company,�has�not�been�able�to�achieve.�Through�Middelborg�we�secure�a�solid�and�long�term�industrial�ownership�as�well�as�a�strong�link�to�Teki�Solutions�which�we�believe�will�be�an�important�part�of�the�partnership.�Furthermore,�there�is�an�industrial�potential�in�combing�the�com-petence,�network,�assets�and�financial�resources�of�Birdstep,�Teki�Solutions�and�Middelborg�to�create�new�growth�opportunities�and�drive�consolidation�in�the�Nordic�telecom�and�IT�sector.�
Lonnie SchillingChief�Executive�Officer
ANNUAL REPORT 20146
RESULT OF OPERATIONS
RESULT OF OPERATIONS.
First�quarter�revenue�was�NOK�0.0�(0.1)�million.�Birdstep�AB�was�the�operational�unit�performing�all�business�transactions,�and�after�the�sale�of�Birdstep�AB�leading�to�the�above�mentioned�reclassification,�there�are�no�revenue�reported�in�the�quarter.
Salaries�and�wages�were�NOK�3.1�(5.7)�million.�The�number�of�employees�as�of�31.03.2016�was�8�(12),�whereof�5�employees�located�in�the�US�have�been�notified�of�termination�as�an�effect�of�the�sale�of�Birdstep�AB.
Other�operating�expenses�for�the�quarter�were� NOK�1.9�(2.6)�million.�Costs�related�to�the�sale�of���������Birdstep�AB�which�was�not�success�based,�are�in-cluded�in�the�other�operating�expenses�and�represent�NOK�0.8�million.
EBITDA�ended�at�NOK�-5.0�(-8.9)�million�which�repre-sents�an�decreased�loss�of�NOK�3.9�million�compared�to�the�same�period�last�year.As�a�result�of�the�above,�Income�(Loss)�from�continu-ing�operations�before�taxes�of�NOK�-5.4�(-4,1)�million�was�recorded�in�the�quarter.
FIRST QUARTER
The�financial�figures�presented�below�are�excluding�Birdstep�Technology�AB�(Birdstep�AB)�due�to�discontinued�operation.�Assets�and�liabilities�related�to�that�entity�were�reclassified�as�held�for�sale,�and�its�profit�as�profit�from�discontinued�operations.�Detailed�information�on�discontinued�operations�is�presented�in�the�notes�section.
ANNUAL REPORT 20147
CASH FLOW
CASH FLOW.
Cash�flow�for�the�first�quarter�was�positive�and�our�net�cash�balance�increased�by�NOK�13.4�million�to�NOK�28.5�million,�and�NOK�20.0�million�after�cash�and�cash�equivalents�classified�as�held�for�sale.�The�first�quarter�last�year�showed�a�cash�balance�decrease�of�NOK�2.3�million.�Net�cash�flow�from�operating�activities�for�the�quarter�was�NOK�6.2�million.�First�quarter�last�year,�net�cash�flow�from�operating�activities�was�NOK�-12.8�million.
Net�cash�flow�from�investing�activities�was�NOK�0.0�(13.4)�million,�and�net�cash�flow�from�financial�activi-ties�was�NOK�7.5�(0.0)�million�originating�from�the�private�placement�to�Middelborg�Invest.�Since�the�closing�of�the�sale�of�Birdstep�AB�was�after�the�end�of�period,�the�transaction�have�not�had�any�material�impact�of�the�cash�position�in�the�first�quarter.
FIRST QUARTER
QUARTERLY REPORT Q1 20158
HEADLINE
SUBSEQUENT EVENT.
FINALIZED SALE OF BIRDSTEP TECHNOLOGY AB
After�end�of�period,�on�7�April,��the�sale�of�all�shares�in�Birdstep�Technology�AB�to�Smith�Micro�Software�Inc�was�finalized.�The�purchase�price�was�USD�2.0�mil-lion�free�of�cash�and�net�debt.�Transaction�costs�and�transaction�related�costs�was�NOK�8.6�million�and�the�total�net�cash�effect�from�the�Transaction�is�expected�to�be�approximately�NOK�15.4�million�representing�NOK�1.14�per�share�in�value�to�Birdstep’s�shareholders.�
The�complete�Transaction�will�be�accounted�for�in�the�second�quarter,�except�for�the�earlier�mentioned�non�succes�fee�based�transaction�costs�of�NOK�0.8�million,�which�have�been�accounted�for�in�the�first�quarter.�After�the�completion�of�the�Transaction�Birdstep�is�expected�to�have�a�cash�position�net�of�transaction�and�other�related�costs�of�approximately�NOK�26.2�million,�excluding�private�placement.
QUARTERLY REPORT Q1 20169
FINANCIAL STATEMENTS
FINANCIAL STATEMENTS.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In�thousands�of�NOK�,�except�share�and�per�share�data) For the three For the full months ended year 31.03.2016 31.03.2015 2015
OPERATING�REVENUES�� -�� �97� -�Cost�of�Sales� �-� �(658)� (1,732) OPERATING�EXPENSES� -� -� -Salaries�and�wages� �(3.095)� �(5,676)� (17,844)Other�operating�expenses� �(1,920)� �(2,616)� (7,369)TOTAL OPERATING EXPENSES (5.016) (8,292) (25,214) Operating income loss before depreciation and amortization (EBITDA) (5.016) (8,853) (26,946) Depreciation�and�amortization�� �(25)� �(86)� (961)Write�down�and�impairment�of�intangible�assets� -� -� (12,788) Operating income loss after depreciation and amortization (EBIT) (5.040) (8,939) (40,695)
OTHER�INCOME�(EXPENSE)� ����Interest�income,�net� �78� �(29)�� 303�Other�financial�items,�net� �(443)�� �4,865� 805�OTHER�INCOME,�NET� �(364)� �4,836�� 1,108� INCOME(LOSS)�FROM�CONTINUING�OPERATIONS�BEFORE�TAXES� �(5,405)� �(4,103)� (39,587) Income�taxes�� �-��� �-���� 160 INCOME(LOSS)�FROM�CONTINUING�OPERATIONS� �(5,405)� �(4,103)� (39,427) Profit�from�discontinued�operations� �(6,322)�� �16,550�� (3,661)� NET�INCOME(LOSS)�� �(11,727)�� �12,447� (43,088) Earnings�and�diluted�earnings�per�share� � �Continuing�operations� �(0,40)� �(0,30)� (2,91)Discontinued�operations� �(0,47)��� �1,22��� (0,27)Total (0,86) 0,92 (3,18)
QUARTERLY REPORT Q1 201610
FINANCIAL STATEMENTS
FINANCIAL STATEMENTS.
CONDENSED CONSOLIDATION STATEMENTS OF COMPREHENSIVE INCOME
(In�thousands�of�NOK�,�except�share�and�per�share�data) For the three For the full months ended year 31.03.2016 31.03.2015 2015
Net�income�(loss)�for�the�period� (11,727)�� �12,447� (43,088) OTHER�COMPREHENSIVE�INCOME� � � �Currency�translation�effect� (334)� �(3,314)�� 2,029�TOTAL COMPREHENSIVE INCOME (12,061) 9,133 (41,059) Attributable�to:� � � �Equity�holder�of�the�parent�company� (12,061)�� �9,133� (41,059)TOTAL COMPREHENSIVE INCOME (12,061) 9,133 (41,059)
QUARTERLY REPORT Q1 201611
FINANCIAL STATEMENTS
FINANCIAL STATEMENTS.
CONDENSED CONSOLIDATION BALANCE SHEETS
(In�thousands�of�NOK�,�except�share�and�per�share�data) As of As of 31.03.2016 31.03.2015 2015
NON-CURRENT�ASSETS:� � � � Intangible�assets� -�� �48,151� -Tangible�assets� -�� �1,188�� 305�Other�non-current�assets� -���� �-���� -���TOTAL NON-CURRENT ASSETS - 49,339 305 CURRENT�ASSETS:� ��� ���� ��Accounts�receivable�� -�� �4,256�� 20,309Other�current�assets�� 308�� �16,882�� 1,056�Restricted�cash� -�� �1,810��� -���Cash�&�cash�equivalents�� 20,035�� �12,601�� 15,090�TOTAL CURRENT ASSETS 20,343 35,549 36,455 Assets�of�disposal�group�classified�as�held�for�sale� 10,136��� �-�� - TOTAL ASSETS 30,479 84,888 36,760 SHAREHOLDERS’�EQUITY:� � � �Share�capital� 13,562�� �10,162� 10,162�Share�premium�fund� 38,272�� �38,272� 38,272�Retained�earnings,�including�translation�reserves� (31,483)�� �26,689� (23,502)�TOTAL SHAREHOLDERS’ EQUITY 20,351 75,124 24,932 NON-CURRENT�LIABILITIES� � � �Deferred�tax�liabilities� -�� �175�� -Other�liabilities� -���� -�� -���TOTAL NON-CURRENT LIABILITIES - 175 - CURRENT�LIABILITIES� � � �Accounts�payable�� 156� �958�� 1,319Deferred�revenue�� -�� �489�� 5,267Accrued�expenses�and�other�liabilities� 3,134�� �8,142�� 5,242�TOTAL CURRENT LIABILITIES 3,290 9,589 11,828
Liabilities�of�disposal�group�classified�as�held�for�sale� 6,837�� �-�� -TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY 30,479 84,888 36,760
QUARTERLY REPORT Q1 201612
FINANCIAL STATEMENTS
FINANCIAL STATEMENTS.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In�thousands�of�NOK�,�except�share�and�per�share�data) For the three For the full months ended year 31.03.2016 31.03.2015 2015
OPERATING�ACTIVITIESIncome�(loss)�from�continuing�operations�before�taxes� (5,405)� �(4,103)� (39,427)Income�(loss)�from�discontinuing�operations�before�taxes� (6,322)� 16,550�� (3,661)�Depreciation�and�amortization� 25�� �1,759�� (961)Write�down�and�impairment�of�intangible�assets������������������������������������������������������������������������������������������-��������������������������-����������������������47,283Profit�on�sales�of�discontinued�operations� -���� �(12,863)���� (12,863)����Change�in�receivables�and�payables� 17,921� �(14,120)� (12,529)NET CASH FROM OPERATING ACTIVITIES 6,219 (12,777) (14,276) INVESTING�ACTIVITIES� �Capitalized�development� -� �(1,096)� (3,238)Furniture,�Machinery�and�Equipment�and�leashold�improvments� -���� �-���� -Change�in�loan�balance�with�affiliated�company� -���� �-���� -Disposal�of�discontinued�operations�net�of�cash�disposed�off� -�� �14,462���� 14,462��NET CASH FROM INVESTING ACTIVITIES - 13,366 11,224
FINANCIAL�ACITIVITIES� � �New�Issue� 7,480���� �-���� -NET CASH FROM FINANCIAL ACTIVITIES 7,480 - -
Effect�of�foreign�exchange�rate�changes� (304)� �(2,885)� 1,435�� Net�increase(decrease)�in�cash�&�cash�equivalents� 13,395� �(2,297)� (1,618)Cash�&�cash�equivalents,�beginning�of�period� 15,090� �16,708� 16,708�Cash�&�cash�equivalents,�classified�as�held�for�sale� (8,450)�� �-� -Cash & cash equivalents, end of period 20,035 14,411 15,090
QUARTERLY REPORT Q1 201613
FINANCIAL STATEMENTS
FINANCIAL STATEMENTS.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(In�thousands�of�NOK,�except�share�and�per�share�data) Birdstep Technology ASA Share Share Other paid Other Translation Total capital premium equity equity reserves equity
Equity as at 31 December 2015 10,162 38,272 61,232 (102,064) 17,330 24,932 Net�income�(loss)�� �-���� �-���� �-���� (11,727)�� �-���� �(11,727)�Other�comprehensive�income�for�the�period: Displacements�between�restricted�and�unrestricted�reservs�� �-���� �-���� �-���� �-���� �-���� �-���Foreign�currency�exchange��� �-���� �-���� �-���� � �(334)� �(334)Total comprehensive income - - - (11,727) (334) (12,061) Transactions�with�shareholders: � Net�issue�of�ordinary�shares�� �3,400��� �-���� �4,080���� �-���� �-���� �7,480��Reduction�in�share�capital�and�transfer�of�share�premium�� �-���� �-���� ����� �-���� �-���� ��Total transactions with shareholders 3,400 - 4,080 - - 7,480 Equity as at 31 March 2016 13,562 38,272 65,312 (113,790) 16,995 20,351
(In�thousands�of�NOK,�except�share�and�per�share�data) Birdstep Technology ASA Share Share Other paid Other Translation Total capital premium equity equity reserves equity
Equity as at 31 December 2014 10,162 38,272 61,232 (58,976) 15,301 65,991 Net�income�(loss)�� �-���� �-���� �-���� �12,447� �-���� �12,447Other�comprehensive�income�for�the�period�� � � � � �Displacements�between�restricted�and�unrestricted�reservs�� �-���� �-���� �-���� �-���� �-���� �-���Foreign�currency�exchange��� �-���� �-���� �-���� �-���� �(3,314)�� �(3,314)�Total comprehensive income - - - 12,447 (3,314) 9,132Transactions�with�shareholders: � Net�issue�of�ordinary�shares�� �-�� �-�� �-���� �-���� �-���� �-�Reduction�in�share�capital�and�transfer�of�share�premium�� �-���� �-���� �-���� �-���� �-���� �-���Total transactions with shareholders - - - - - -Equity as at 31 March 2015 10,162 38,272 61,232 (46,529) 11,987 75,124
ANNUAL REPORT 201414
NOTES
NOTES
The�accompanying�consolidated�financial�statements�are�prepared�under�International�Financial�Reporting�Standards�(IFRS).�Our�fiscal�year�runs�from�January�1�to�December�31.�
The�accompanying�condensed�consolidated�state-ments�of�operations�and�cash�flows�cover�the�first�three�months�of�2016,�and�the�related�information�on�Birdstep�included�in�these�notes�to�the�financial�statements�is�unaudited.�In�the�opinion�of�manage-ment,�such�interim�statements�include�all�adjust-ments,�which�consist�only�of�the�normally�recurring�adjustments�necessary�for�a�fair�presentation�of�the�consolidated�results�of�operations,�financial�position�and�cash�flows�for�each�period�presented.�The�interim�consolidated�results�are�not�necessarily�indicative�of�results�for�the�full�year.�
The�same�accounting�policies�and�methods�of�com-putation�are�followed�in�the�interim�financial�state-ments�as�those�of�the�most�recent�annual�financial�statements.
These�interim�financial�statements�are�presented�in�Norwegian�crowns�(NOK).�The�functional�currency�of�Birdstep’s�foreign�operations�is�the�currency�of�the�country�in�which�the�operations�are�conducted.�The�accounts�of�Birdstep�are�translated�into�the�re-porting�currency,�NOK,�using�exchange�rates�in�effect�at�period-end�for�assets�and�liabilities,�and�at�average�exchange�rates�during�the�period�for�the�results�of�operations.�
EBITDA�is�equivalent�to�operating�income�(loss)�ex-cluding�both�discontinued�operations�and�non-cash�charges,�such�as�depreciation�and�amortization.
Income�per�share�is�calculated�by�dividing�net�income�available�to�common�shareholders�for�the�period�by�the�weighted�average�number�of�common�shares�outstanding�during�the�period.
As�of�31�March,�2016,�the�Company�has�13,562,163�shares�issued�and�13,560,249�shares�outstanding,�the�difference�of�1,914�representing�treasury�shares.
ACCOUNTING POLICIES
QUARTERLY REPORT Q1 201615
FINANCIAL STATEMENTS
DISCONTINUED OPERATIONS
(In�thousands�of�NOK�,�except�share�and�per�share�data) For the three months ended 31.03.2016
NON-CURRENT�ASSETS:Intangible�assets����������������������������������������������������������������������������������������������������������������������������������������������������������� ���������������������������������������������-�����������������������������Tangible��assets�����������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������250�� ������������������
Other�non-current�assets���������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������-������������������������������TOTAL NON-CURRENT ASSETS 250 CURRENT�ASSETS:� � � �Accounts�receivable��������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������337���������������Other�current�assets������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������1,099�����Cash�&�cash�equivalents����������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������8,450� �TOTAL CURRENT ASSETS 9,885 Assets of disposal group classified as held for sale 10,136 NON-CURRENT�LIABILITIESDeffered�tax�liabilities������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������-�Other�liabilities������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������-TOTAL NON-CURRENT LIABILITIES - CURRENT�LIABILITIES� � � �Accounts�payable������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������787� �������������Deferred�revenue�����������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������4,057�������������������Accrued expenses and other liabilities 1,993 TOTAL CURRENT LIABILITIES 6,837 Liabilities of disposal group classified as held for sale 6.837
On�8�March�2016�Birdstep�signed�share�purchase�agreement�for�sale�of�all�shares�in�Birdstep�Technology�AB�to�Smith�Micro�Software�Inc�for�USD�2.0�million�free�of�cash�and�net�debt�before�account�for�transaction�costs.
.
The assets and liabilities related to Birdstep Technology AB have been presented as held for sale following the completed sale of 100 % of the shares in the company on April 7th
QUARTERLY REPORT Q1 201616
FINANCIAL STATEMENTS
DISCONTINUED OPERATIONS
(In�thousands�of�NOK�,�except�share�and�per�share�data) For the three For the full months ended year 31.03.2016 31.03.2015 2015
OPERATING REVENUES 1,693 15,562 56,410Cost of Sales (549) (294) (1,989) OPERATING EXPENSES Salaries and wages (4,997) (4,577) (17,941)Other�operating�expenses�������������������������������������������������������������������������������������������������������������������(2,540)� (5,079)� � (14,679)TOTAL OPERATING EXPENSES (7,537) (9,656) (32,620) Operating income loss before depreciation and amortization (EBITDA) (6,393) 5.612 21,800 Depreciation and amortization (22) (1,673) (6,022) Write down and impairment of intangible assets - - (34,495) Operating income loss after depreciation and amortization (EBIT) (6,415) 3,939 18,716 OTHER INCOME (EXPENSE)Interest income, net - - -Other�financial�items,�net����������������������������������������������������������������������������������������������������������������������������93� (253)� � 2,192OTHER INCOME, NET 93 (253) 2,192 PROFIT FROM DISCONTINUED OPERATIONS BEFORE TAXES (6,322) 3,687 (16,524) Income taxes - - -Profit from sale of Birdstep OY - 12,864 12,864 PROFIT FROM DISCONTINUED OPERATIONS (6,322) 16,550 (3,661)
Analysis of the result of discontinued operations is as follows
QUARTERLY REPORT Q1 201617
RISKS
RISKS.This�report�contains�statements�regarding�the�future�in�connection�with�the�company’s�growth�expecta-tions,�general�and�specific�market�outlook�and�objec-tives.�All�statements�about�the�future�are�subject�to�inherent�risks�and�uncertainties,�and�many�factors�can�lead�to�actual�profits�and�developments�deviating�substantially�from�that�which�has�been�expressed�or�implied�in�such�statements.��
Birdstep�Technology�is�exposed�to�various�forms�of�market,�operational�and�financial�risk.�Birdstep´s�business�is�dependent�on�the�partnerships�under�
establishment�between�Smith�Micro,�Birdstep�and�Teki�solutions.�Birdstep�is�also�dependent�on�the�con-templated�merger�with�a�subsidiary�of�Middelborg.�Any�delay�or�negative�development�regarding�the�partnerships�or�the�contemplated�merger,�may�have�negative�impact.�
The�company’s�various�risks�have�been�described�in�the�Annual�Report�for�2015�in�further�detail�and�no�other�risks�has�been�identified.
BIRDSTEP IS HEADQUARTERED IN OSLO, NORWAY, WITH ITS OPERATIONAL HEADQUARTER IN STOCKHOLM, SWEDEN,
WWW.BIRDSTEPASA.COM
FINANCIAL CALENDAR 2016.Preliminary�financial�calendar,�with�reservations�for�changes:
29.07.2016 QUARTERLY REPORT - Q203.11.2016 QUARTERLY REPORT - Q3
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