hansab_annual_book_2012

Hansab Group AnnuAl report 2011

year of new projects development and GrowtHbenefits from

complex solutionsdiversificationsolid business development

and positive outlook summary of tHe activities

A successfulrecovery

strAtegicAlly integrAtedcommunicAtion

increasinG service systemeffectiveness

businesstHAt

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contentsAigar Urva

Jaak Õunpuu

Nerijus Žikas Algo Puusepp

Agnia Nast Annika Urva-Ronk Janno Kallikorm

Darius Žekonis

Andres Johannson Alar Alumaa

Margus Tammoja Kairi Pavelson Ruta Urva

Pranas AleksiunasIngemars Liakovicus

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2 a successful recovery by Aigar Urva / ceo of Hansab Group oÜ4 about us5 Hansab Group revenue structure of tHe companies6 solid business development and positive outlook for 2012 by Nerijus Žikas / business development manager8 increasinG service system effectiveness tHrouGH innovative tecHnoloGy solutions by Algo Puusepp / service manager10 strateGically inteGrated marketinG communication by Agnia Nast / marketing communications manager12 Human resource development by Annika Urva-Ronk / Human resources manager14 2011 – a very special year by Janno Kallikorm / managing director of Hansab as16 latvia takes off by Ingemars Liakovicus / managing director of Hansab sia18 benefits from complex solutions and diversification by Darius Žekonis / managing director of Hansab uab20 overview of Hansab tob activities in 2011 by Pranas Aleksiunas / managing director of Hansab tob22 summary of tHe activities in baltic operation services oÜ in 2011 by Andres Johannson / managing director of bos oÜ24 ellore 2011, year of new projects, development and GrowtH by Alar Alumaa / managing director of ellore oÜ26 financial results by Jaak Õunpuu / cfo of Hansab Group oÜ28 consolidated balance sHeet30 consolidated income statement31 innovative solutions by nature33 contacts


last year, the 20th year in Hansab history, was successful for Hansab Group. after the major financial crisis in 2009 our home markets showed a fast recovery that positively affected our results. during the last two years we have achieved fast turnover growth (26% in 2010 and 23% in 2011) and got back to our best results, the years of economic wealth in 2007 and 2008.

in spite of current uncertainties in the economy, we hope to continue our growth and to achieve our all-time best results. similar to previous years the biggest potential for us is to increase our presence in the retail and public service sectors. the banking sector, which was our major field of activity for a long time, on the other hand shows a modest growth perspective in the near future.

the strategic goal of Hansab is to offer our customers innovative technology solutions to make their business more effective and secure. this strategy has brought us success and confirmed that

we are moving in the right direction. therefore we decided to concentrate our attention in this Hansab Group 2011 annual book on presenting the complex solutions we have delivered during these past years. by focusing more on offering our customers complete solutions, we have made company structural changes – the projects department was created to handle all project development and installation once the agreement is signed.

another significant achievement is the further development of our service system. last year we focused mainly on increasing the effectiveness, enhanced monitoring system and implemented several it solutions that simplified everyday operations for our customers and employees. our service turnover showed a significant increase over 20%, with our successful service export projects being partially responsible. this year we will continue in these directions and hopefully find more possibilities to engage in such projects.

in 2011 we continued to develop our business in the ukraine and belarus. unfortunately in spite of our additional investments the results in those countries were below expectations.

to summarize, Hansab Group managed to increase group profit by 47%. uab Hansab showed especially good results, who achieved the best results during this time (turnover of 7.1 million euros, profit before income tax of 0.53 million euros) and

ellore oÜ, whose main activity is payment solutions development and who has brought to market a new generation of pos terminals. as Hansab showed also good results, where sia Hansab and tob Hansab, in spite of significant turnover increase showed unsatisfactory performance.

i strongly believe that due to our satisfied customers and fellow employees we will successfully manage to implement our strategy and fulfill our ambitious goals this year.

a successful recovery

Aigar Urva ceo of Hansab Group

“in spite of current uncertAinties in tHe economy, We Hope to continue our groWtH And to AcHieve our All time best results.”

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Hansab was first founded in estonia in 1991, by present Hansab Group ceo aigar urva. Hansab latvia followed in september 1993, Hansab lithuania in 1994 and Hansab tob in 2009 in the ukraine. in 2005, Hansab Group oÜ was established to manage Hansab Group enterprises, business development and central coordination of focal processes.

throughout the years we developed into a leading company providing innovative technology solutions for businesses – especially in financial, retail and public sectors in the baltic region, ukraine and belarus.

in 2007 two new companies joined Hansab Group: ellore oÜ, mainly dealing with financial and card payment solutions integration and development,

and baltic operation services (bos), also known under the brand moya, which focuses mainly on operating different vending machines. currently, Hansab Group has eight subsidiaries – Hansab as, Hansab sia, Hansab uab, Hansab tob, baltic operation services oÜ, ellore oÜ, Hansab kinnisvara oÜ and Hansab turtas uab. there are over 170 people on the Hansab team, and as many as two thirds are engaged in the service areas.

Hansab complete solutions involve consultancy, software development and integration, software and hardware sales, installation and after sales services, together with the possibility of service export. all processes, services and structure are the same in all Hansab companies. this ensures a high level of service no matter the location.

Hansab Group is the only company in the baltics that offers such a wide range of products and solutions. according to the latest statistics, the companies service approximately 30 000 devices, including 1750 automatic teller machines (atms).

all services offered by Hansab in our territory comply with iso9001 and iso20000 standards. Hansab has implemented all itil processes and adequate resources to meet the customers’ demand and our services are reliable and have good support.

Quality is an essential indicator in Hansab organizations. our effort to keep this at a high level has been acknowledged several times with different Quality management awards – one of the most prestigious criteria for an organizations’ evaluation.

about us structure of tHe companies

Hansab Group OÜestablished in 2007

Headquarters Established Branches in

Hansab AS tallinn, estonia 1991 tartu, pärnu, jõhvi, kuressaare, kärdla

Hansab SIA riga, latvia 1993 rezekne, liepaja, valmiera, daugavpils

Hansab UAB vilnius, lithuania 1994 kaunas, klaipeda, siauliai, panevezys

BOS OÜ tallinn, estonia 2006

Ellore OÜ tallinn, estonia 2007

Hansab Property OÜ tallinn, estonia 2009

Hansab TOB kiev, ukraine 2009

Hansab Property UAB vilnius, lithuania 2010

Hansab Group revenue

sales

service

thousand eur20 000

18 000

16 000

14 000

12 000

10 000

8000

6000

4000

2000

02000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

forecast

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2011 was a good year for Hansab companies. this year we continue with our strengths in order to provide intelligent solutions for businesses. our strategy is to use a more segmented approach in order to provide complete solutions for each sector and to better approach the needs of our customers. these three main sectors are banking, retail and public. in many of these areas we are already the best or have the potential to become the best. in terms of financial results, they have reached close to the highest levels during the history of Hansab. total group revenue grew by 23%, where sales of products were 70% and sales of services were 30% of total revenue. these numbers were achieved thanks to the increase in the rather new sectors for us: retail and public. every year Hansab Group acknowledges it best sales projects that are chosen from all projects nominated for this title. last year there were two projects sharing this title: complex sales’ solutions for prisma hypermarket in latvia: consisting of a pneumatic tube system, cctv cameras, eas gates

and many others. the second is the sales of an innovative library system to the vilnius library, which will take the borrowing of books to the next level. these projects are a good indicator that Hansab is indeed a full solutions provider for any business and we anticipate more of such projects in the future.

this year we are determined to continue our activities in the ukraine. with a good customer database, complete sales team and organizational investments we are anticipating better results than last year. in belarus we are using a rather careful approach and acting through our partners. similar to last year we intend to continue selling our solutions and services to the scandinavian markets: finland and sweden.

to address long-term growth and challenges, Hansab is increasing the focus on service export. although service export is not entirely a new direction for Hansab, we believe now is the right time to take it to the next stage. our export activities are supported by

a strong presence in our home market – the baltics and operations in the ukraine, our know-how and long term experience with installation and software integration capabilities. in 2011 we have successfully completed installation of a tube transport system in one of the biggest hospitals in sweden, which has proven this as the right direction and gives us good references moving forward. we have initiated dialogue on this topic with our partners and have received positive feedback. we are open to discussion about service export possibilities, whatever your needs might be. last year our enterprise estonia funded export activity project was successfully finished. this gave us an opportunity to apply for new funding and to begin the year with the new two year project.

we have good reason to be confident about the future of Hansab Group. our strong technological capabilities and years of experience presently open up strong opportunities for us in our markets and other possible markets in the future.

solid business development and positive outlook for 2012

Nerijus Žikas business development manager of Hansab Group

“to Address long-term groWtH And cHAllenges, HAnsAb is increAsing tHe focus on service export.”

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51%

13%

11%

25%

public services (state institutions, Healthcare)

other

retail

banking & finance

customersegments

structure of revenue by

product

33%

service

security solutions

consumables

card solutions

finance and payment systems

automated systems

cash handling

1%

29%

4%

11%

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16%

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today’s technology is developing rapidly and offers our service providers new innovative ways to deliver our services to the customers. in 2011 Hansab has taken a number of significant changes and improvements that were associated with the desire to increase service quality. the key terms are faster and more secure movement of information to customers and providing them a more detailed overview about resolving incidents. one of the major projects was the total business software update to new modern technologies. Hansab uses the microsoft dynamics nav platform to manage its processes and values. in early 2011 we decided to work with a new partner, company who is a leading expert in this software area. together in the first half of the year we implemented changes in each Hansab group company. the main purpose of the erp version upgrade was the introduction of new advanced solutions for services and sales.

the other major development in 2011 was development and implementation of a new customer portal. at the end of last year the new version of the client portal was available for use by all Hansab customers.

the customer portal allows:• to enter and confirm new orders;

• to view all active orders and track the detailed information about deadlines;• to view order history and statistics;• to have an overview of equipment under the service agreement;• to view invoice data for the servicesthe customer portal enables customers to keep track of all equipment-related events over the web and saves valuable time managing them. all communication between the Hansab helpdesk and technicians happens via our own developed solution called navmob. this solution works on mobile devices and provides technicians with all necessary information needed to fulfill customer orders, with information moving in real-time. when a technician begins or finishes the fulfillment of the customer order the work status is changed accordingly. this allows the customer to see in real-time whether his orders are in progress or completed. in 2011 we developed a modified version of navmob now used by all technicians in Hansab estonia, latvia, lithuania and ukraine. our customers can also receive automatic notifications of when the execution of their orders have been initiated or completed. the customer is also informed about errors and problems caused by equipment malfunction. this solution is called

“automatic e-mail” and is created for the customers who want to import this information into their own internal incident management system. all Hansab service cars are equipped with Gps devices for technicians that are directly connected to our helpdesk. this solution helps us to plan customer order fulfillment processes and increase service efficiency. in 2011 we continued to develop our monitoring unit. we have improved monitoring software and significantly increased the number of monitored devices. a total of 12 people work in the monitoring department and services are available 7 days a week. the main objective of monitoring is to prevent errors due to more efficient analysis and to fix them remotely. at the same time we are able to use the information we received from the devices, to make more accurate decisions. overall, 2011 was an important year in terms of a variety of information technology solutions for the improvement of our services and making our customers more informed and independent. this year we are proceeding with all of the undertaken changes in maintaining our image as being the provider of innovative solutions to its customers.

increasinG service system effectiveness tHrouGH innovative tecHnoloGy solutions

Algo Puusepp service manager of Hansab Group

“tHe Key terms Are fAster And more secure movement of informAtion to customers.”

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Hansab marketing has enjoyed substantial developments since it was formed in 2007. as the busy year has drawn to a close, we reflect on what we have learned and what to expect in 2012. this year we continue to focus on makreting of our complex solutions and services. this years’ challenge is a segmented approach in marketing and communication aimed towards banking, public and retail sectors.

seproHansab is continuously investing in improving the quality of service, development of service structure and processes. to ensure that Hansab customers get the best service and quality of care and to make our services easily recognizable among the competitors in 2011 the name of our service sepro was born. sepro stands for ‘service professionals’ or that Hansab service and maintenance are always done at a highly professional level that guarantees to the customer the best possible results. sepro is essentially a full-service package, or the highest degree of service that a customer can reach. we want our customers to recognize our effort and sepro is a sign of only the best service quality.

internet marketinGto maximize customer benefits the strategic decision

was made to refurbish our website. the process already began in 2010 and in may 2011 the new website was launched. when we set out to redesign the site, we had a number of clear objectives. in addition to making the site’s visual design more pleasing, we invested extensive time and energy into crafting a solid information architecture that would dramatically organize content to make it easier for people to find the things they need. while we are still fine-tuning it, we are thrilled about the launch of this ambitious project, as well as the positive feedback we have received. we recognize the change may be an adjustment for some, but believe the new design will prove to be a marked improvement over our past site experience. another area of growth in 2011 has been content marketing. Hansab has taken content marketing seriously; as no other form of marketing allows the opportunity to engage with our customers for as long and as deeply. we have new newsletter templates and newsletter distribution system in all four countries to provide news and information to our partners and customers in all our operating languages. the new layout and system allowed us to maximize content readability and therefore increase the number of subscribers. in addition to general information, we also distribute information according to our strategically assigned sectors: banking, retail and public.

customer surveyas Hansab is mainly focused on a two way communication model and we collect feedback on an everyday basis, our annual customer satisfaction survey is also extremely important for us. similar to previous years, our customers identify us as being a reliable business partner, provider of innovative solutions and offering high quality services according to what the customer really wants. satisfaction indicators stayed on similar level as the previous

year – staying above 4,2 on a scale from 1 to 5. we are happy to share that last year’s survey was no longer anonymous. the option was there for respondents to stay anonymous and we are impressed that less than 10 percent of all respondents used this option. we believe this is a good indication of our trustful and close relationship with our customers.

this year’s challenge is to use intelligently analyzed data in order to get the right messages to the right customers. to do so we use a segmented approach in our marketing activities, new products and solutions seminars and specialized customer events. we want our customers to be the first to know about innovative solutions that we develop to make their businesses secure, simple and profitable.

strateGically inteGrated marketinG communication

Agnia Nast marketing communications manager of Hansab Group

“sepro is essentiAlly A full-service pAcKAge, or tHe HigHest degree of service tHAt A customer cAn reAcH.”

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in following the company strategy the keywords for last year were training and development of personnel in acquiring and keeping competencies. to support company development a major part was played by internal and external trainings, recruiting new competencies to necessary fields and keeping these competencies through effective and systematic personnel management.

in 2011 a major change of separation of the project management from the sales department and establishment of the projects department was completed. new employees were recruited and trained. the goal of the establishment of the department of project management is to develop project competency in the company and to be ready to manage extensive projects. a goal for this year is to improve the motivation and evaluation system considering the changes in the structure of the company.

last year was already the second year when the total number of Hansab employees increased. in spite of constant work towards increasing the efficiency in the personnel management through improving the work processes, it was inevitable that new

employees were needed. the number of Hansab Group employees increased by 10%, reaching 168 employees by the end of the year.

in the fall of 2011 Hansab Group conducted, for the 11th time, the Hansab Group employee satisfaction survey. 94% of all Hansab Group employees participated in the anonymous survey. the best results were achieved by uab Hansab, showing a satisfaction level of 4,2 on a 5 point scale. it was the best result for uab Hansab throughout the years. compared to last year, the biggest change was in sia Hansab, where the end result improved by 0,3, reaching a 4 point average on the 5 point scale.

the average for all group companies was 4,0 – which corresponded to the set goal. the highest marks were received in working environment related questions; such as quality of means for everyday work, the level of information available for the employees etc. pride to be working in Hansab and the feeling of belonging to the company received the highest marks of all. the survey also provided good feedback about the work between different companies’ departments

and it was possible to make analysis about the cause of problems mentioned and take actions for improvement.this year we continue to focus on friendly and positive interaction between and towards employees. we are following the same core values that were established at the very beginning of Hansab, where the aim of these core values was and continues to be to have a healthy, coherent and employee friendly organization in all Hansab Group companies. the keyword for our organization is transparency. employees are informed about everything that is happening in the company, be it positive or negative; necessary changes are explained and employees are involved in the decision making process. last year one of the memorable events was Hansab’s 20th birthday. our customers, partners and colleagues were invited to a james bond casino royale themed celebration that took place in estonia. to make the celebration of this important milestone in Hansab history even more memorable we had filmed our own short version of james bond casino royale, with the Hansab as employees as actors and long-term expert in the film making business kuukulgur. this experience exceeded our expectations and the film itself received positive reviews.

Human resource development

Annika Urva-Ronk Human resources manager of Hansab Group

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“in 2011 A mAJor cHAnge of sepArAtion of tHe proJect mAnAgement from tHe sAles depArtment And estAblisHment of tHe proJects depArtment WAs completed. ”

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Hansab as celebrated its 20th anniversary in february 2011, being one of the first companies in estonia to reach this milestone. during those 20 years Hansab has grown into a multinational and international company operating in 4 different countries. we can proudly say that the celebration of our anniversary together with our partners and customers turned out to be an event we will never forget. i hereby would like to thank everyone involved and on the brink of our business’ third decade wish everyone a prosperous future together. in 2011 Hansab also showed good financial results. the sales targets were met accounting up to 6.6 million euros in revenue and 0.37 million euros in profit, giving a 5.6% margin. 2011 was a very special year in regard to sales of services, 40 new sla agreements were signed giving an increase of 16.7% in sla revenue.

a year of continuous improvementto further improve and offer our customers an even better service we restructured our organization by creating a project department for a more fluent process in project management and installations. by the beginning of 2012, four people were employed and working in our newest department.

a year of self-service and innovative solutionsin 2011 we saw continued investments in the

banking sector into innovative technology and self-service equipment, most notable being the investments into recycler and deposit atm units. Hansab supplied and installed 46 ncr recycler atm units and 30 ncr deposit atm units during the year, giving banks’ customers more opportunities and flexibility to make their cash transactions. we are very proud to have been awarded with the “circle of excellence” award by the ncr in 2011.

an innovation oriented mindset led us to new exciting projects. the first uHf rfid (ultra High frequency) based library renting and security system in the baltics was deployed by Hansab and kno-tech in the tallinn university academic library. this innovative solution lets the readers rent and return numerous books while at the same time speeding up the process remarkably and getting rid of queues. at the same time the security features (e.g. security gates) are not seen by the patrons and therefore not harassing them. the director of tallinn university academic library andres kollist: “a library that does not keep up with today’s technology will lose its readers. rfid is an evolving technology, which can in the future be used for displaying information about the books or locating books with a smartphone.”

best security solution in 2011Hansab and the estonian tax and customs board were awarded the “best security solution in 2011”

award by the estonian security association for deploying the first portable x-ray device (flatscan-tpx by 3dx-ray ltd) in estonia. the main gain from using the equipment is the mobility. the suspect item for hidden goods – a car, a briefcase or whatever it may be can be checked in any location and at any time. this was the 6th time that Hansab along with its customers and partners received this honorable award.

lookinG forward to 2012in 2012 our main focus will continue to be on the deployment and servicing of new and innovative technologies in our strategic sectors - banking, public and retail. we have great projects to look forward to: e.g. exposition technology installations in the estonian sea museum’s aircraft Harbour and in the tallinn tv tower, customer flow management systems in all of estonia’s migration offices, uHf based library systems in various libraries all over estonia. and, most importantly, we will continuously be working on improving our services to our customers. we are investing into new innovative solutions for equipment monitoring and enhancement of customer interfaces (e.g. customer portal and help-desk). through these continuous and strategic improvements we wish to maintain and confirm our image as a trustworthy and reliable partner.

2011 – a very special year

Janno Kallikorm managing director of Hansab as

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“40 neW slA Agreements Were signed giving An increAse of 16.7% in slA revenue.”

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when you start a new year you begin to collect your results from ground zero again. and this is nice especially when you have had years of deep economic crisis. the beginning of 2011 started with a similar sales revenue as to the previous year, however in the second half of the year our sales started to gain. of course there were projects that we put a lot of effort into and expected to come through in the second half of the year; even still, we could feel a general pick up of the economy in latvia. the market started to be driven not only by export but also by some increase in domestic market demand. it resulted almost doubling of our sales in comparison to the 2010. in the second half of the year we sold 2/3 of the total sales of the entire 2011. as our service revenue increase was not as significant as sales the company total turnover increased by 41% in comparison with the previous year.

during the last few years our organization worked hard to enter the retail, public and state market segment while remaining in the leading position in banking. therefore we are glad that last year we had major projects in retail, public and state sectors. we realized our, to this point, largest low voltage complete solution project in a new shopping mall for the prisma company. this was an integration solution of cctv, access control and alarm systems being managed by servers in one system. in addition we also supplied a pneumatic tube system (pts) and cash handling devices. another achievement of 2011 is alarm systems being managed by servers in one system. we also

supplied a pneumatic tube system project in riga’s eastern clinical Hospital. installation will be fully completed in early 2012. there are 1.15 km of piping and 14 working stations. this pts installation will significantly improve hospital efficiency and the speed of operations that are key factors in any hospital.

our largest project in banking was a ncr recyclers delivery for swedbank latvia. these money recycling machines will be able to cash in and cash out money. in addition the same money will circulate between both systems in the machine saving on cit expenses for the bank. another very important project for sia Hansab was the deal with swedbank for a pos terminal business startup at the end of 2011.

we are confident that a long prospective relationship and cooperation with a customer is the key to success. we have taken steps in order to improve efficiency, reaction speed and quality of our solutions and services. first of all we have established and integrated projects department in our company that allows us to shift the responsibility of installed works away from our service department in order to keep their focus on service contracts. we started to feel the first benefits of this step at the end of 2011 when working concurrently on a few large projects.

another good investment was our service team training focused on improving the communication level and to refresh knowledge about behavior

at a customer’s premises. at the end of 2011 we started to implement navi mobile (navmob), which will improve our efficiency in allowing us to keep our engineers informed and to get feedback from them about the work status using smartphones, while at the same time inputting information for the automatic generating of necessary reports.

as in every year, we measured the customer satisfaction level and we are proud that we have achieved an evaluation of 4.24 points on a 5 point scale. However, we still see potential for improvements. we want our customers to always smile when we meet. this is a nice target to achieve.

we have ambitious plans for 2012. according to the budget our sales should double again, with total company revenue increasing by about 50%. our general situation in the market and projects in the pipeline make us believe we will reach our targets.

in 2012 our sales department will focus on innovative development projects and keeping good and trustful relationships with our customers. our service department will continue being more effective and fast operating, which will also help us to improve quality.

but most importantly we will continue to be more and more customer friendly. our team is positive, inspired by growth and we want to share that with our most valuable asset – our customers.

latvia takes off“tHe mArKet stArted to be driven not only by export but Also by some increAse in domestic mArKet demAnd.”

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Ingemars Liakovicus managing director of Hansab sia

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2011 was the most generous and successful year for uab Hansab in terms of sales, beating all the records of the previous 17 years in the company’s history in lithuania. the acceleration of turnover, which started in 2010, did not fade away and reached a historical peak of 51% growth, with the total result of 7.1 million euro (2010 sales revenue comprised 4.7 million euro). compared with 2010 results the profit before taxes was twice as euro and exceeded the companies highest expectations. these results were achieved because of the right decisions and actions taken by the management of the company during the crisis period.

our focus on complex solutions and client service development did not go unnoticed by our customers. the key factors in helping to solve business problems and making it more profitable are optimization of company processes, structure and what is most important – development of new services and innovative solutions implementation to new markets. all these things, together with 17 years of experience in the local market and reliable partners, have allowed our company to offer innovative solutions to customers, creating added value. uab Hansab takes pride in its implementation of the first and biggest automated self-service parcel terminals in lithuania, bringing our customers, lietuvos paštas and kautra, to a new technological level with outstanding possibilities – 24/7 automated deposit and pickup of parcels.

2011 was also an opportunity for uab Hansab to strengthen our positions in the recovering retail

sector. the sector was back on its usual investment track, opening new shops and what is most important – replacing outdated security technologies with new complex security solutions for articles’ surveillance and protection, where our company is especially strong. in 2011 uab Hansab created, adapted and carefully tested specialized solutions in electronic article surveillance (eas) and video surveillance (cctv) systems for senukai, lithuanian’s largest wholesaler and retailer of building supplies. it was both a challenge and a big step for senukai in taking security systems to a higher level.

introduction of a new type of service – service export abroad (installation of more than 8 km of tube transport in one of the biggest hospitals in sweden) – was a step towards new markets along with great references, and was a strong push not only for company financial results (turnover from service doubled since 2010), but also increased the possibility to get more projects on an international level.

uab Hansab revenue mainly comes from three sectors: banking, retail and public. lithuania‘s economic recovery finally stabilized the situation in the banking sector. the end of the year showed that the sector was profitable; however it was partially achieved by a cost cutting policy that resulted in limited investments in innovations. most of the revenue from the banking sector (40% of total sales revenue) came from service agreements. the 4th quarter of the year was met with an unexpected

shock in the banking sector – ab bank snoras’ bankruptcy, which negatively impacted planned sales. nevertheless a snoras customer migrating to other banks gives new possibilities to strengthen relations with other banks. as mentioned before, the retail sector revival and interest in protection of their property, video and electronic articles and demand of parking solutions were factors that helped uab Hansab reach its highest revenue in this field, which accounted for 10% of the total sales revenue.

continuous business developmentthe business development strategy, which was followed by establishing a new department of project management, was a significant step towards new activities’ expansion – complex and sophisticated project management. this makes our company stronger in creating, implementing and servicing technological solutions. the decision to separate project management and sales was very beneficial for several reasons: internal processes optimization and increasing customer satisfaction. it is important to mention that there was great attention taken to the development of new areas in terms of searching for new products and reliable partners that ensures our customers that they stay informed on new market trends and receive the highest quality services. ambitions to always be a few steps ahead and superior in the market keeps uab Hansab investing in its personnel expansion and training. this was realized by expanding the sales team and strengthening the regional offices. also a crm system is being implemented to manage vast amounts of data in faster and simpler ways.

benefits from complex solutions and diversification

Darius Žekonis managing director of Hansab uab

“uAb HAnsAb tAKes pride in its implementAtion of tHe first And biggest AutomAted self-service pArcel terminAls in litHuAniA.”

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tob Hansab is the youngest member of Hansab Group, established in 2009 in kiev, the capital of ukraine and is responsible for business in the ukrainian territory. since the establishment the company has managed to acquire customers, self-establish itself in a challenging business market and reveal potential for the future.

if 2010 was a good start for the growth of the company then 2011 was a year of several fundamental developments in company structure, image creating and marketing. the sales department employed three sales managers, acting mainly in the banking and retail sectors.

in 2011 we managed to almost double our turnover, a 90% increase compared to the previous year. our top project of 2011 continues to be the alfa bank project, where we have 26 installations of customer flow management systems. currently,

in total we have installed 39 cfm systems throughout the ukraine. another very important event in tob Hansab’s development is the signed cooperation contract with the Gunnebo Group, where we will begin to penetrate the ukrainian market together.

in may 2011 Hansab tob, with the assistance of the national bank of ukraine, the ukrainian banks association and our long term partner Gunnebo Group, held an international conference: “modern technologies of customer service in the financial sector.” the conference was attended by several banks, such as: alfa-bank, raiffeisen bank aval, procredit bank, vtb bank, seb bank, swedbank, fuib, otp bank, finance and credit bank, ukreximbank, rodovid bank. feedback that we received was positive and this conference also provided us a sufficient customer base that was interested in receiving our newsletter in order to stay in the information loop. since it was

such a positive experience we are planning to hold this conference again this year.

in 2011 Hansab companies welcomed its new website, fully functioning in five languages. for Hansab tob the new website launch has proven to be a very successful sales tool and information source for our customers. we have expanded our products, solutions and service portfolio. we are constantly updating the website with the latest news and customers can sign up for our quarterly newsletter, which was also one of the successful developments of the last year that has received positive feedback from customers and is reflected in our sales’ numbers.

as our team is fully equipped with employees, experience and sufficient customer database we are hoping to achieve our ambitious goals.

overview of Hansab tob activities in 2011

“in 2011 HAnsAb compAnies Welcomed its neW Website, fully functioning in five lAnguAges.”

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Pranas Aleksiunas managing director of Hansab tob

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baltic operation services has provided reverse vending and vending machine operating services under the brand name moya for five years. during this period we have been able to increase our turnover every year. in 2011 our turnover increased both in reverse vending machines and vending machines operations by 10%.

last year we focused more on the sales of various coffee machines and vending machines. we started to represent and sell jura coffee machines and supplies in addition to sielaff and rheavendors. another business direction we have started with is to prepare freshly roasted coffee bean selections under the brand name moya. from the maintenance side we have significantly improved the quality of vending machine operations.

all these activities, along with the introduction of the euro in the beginning of 2011, have increased the turnover of vending machines last year.

in the field of reverse vending machines (rvm) we have increased the quantity of machines and changed every day working principles. changes in personnel policy have enabled to improve overall rvm operating quality. there were also made several updates in rvm monitoring programs and feedback systems enabling more effective reaction and operation from our side. implementation of new projects in cooperation with our partners has resulted in a better understanding of customer needs, improved customer service quality and increased turnover.

thanks to the enduring close cooperation with Hansab, we were able to ensure the regular operation of rvm and minimize standby hours. in 2011 we started with the renovation of rvm machines by replacing the worn-off details and components. this process also continues in 2012.

close cooperation with the two biggest chains of supermarkets and other stores has given us a possibility for further development and installation of new reverse vending machines that will mean better service for the customers. moya has a strong position and is continuously increasing its market share in its field of activities.

our main aim is to offer the best quality of service to our customers.

summary of tHe activities in baltic operation services oÜ in 2011

Andres Johannson managing director of baltic operation services oÜ

“lAst yeAr We focused more on tHe sAles of vArious coffee mAcHines And vending mAcHines.”

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2010 was successful for the ellore ltd who turned four years old. Hard work and efforts during the year paid off – the company succeed to achieve main financial targets and fulfill major strategic plans.

the main fields of activities were tightly connected with financial and card payment solutions integration and development.

the biggest drivers for success had been recovering economy, continuous growth of card transactions volumes and strengthening security rules in the baltics. the growth potential and market demand for modern card payment solutions is the biggest in latvia and lithuania but also in estonian market, the demand was impacted by euro migration and its influence on card transactions increase.

ellore 2011, year of new projects, development and GrowtH

Alar Alumaa managing director of ellore oÜ

card payment solution competence centerone of key processes was to strengthen ellore competences and organizational resources to carry out the card payments solutions competence center function within Hansab Group. ellore performs systematic solutions integration works, pre- and aftersales consultation and third level problems resolution services around lithuania, latvia, estonia and ukraine. the main goal for ellore is to collect the integration resources and skills by combining assess and select tools to lead and support corporative projects and optimize the investment costs at enterprise level.

new telium2 terminal Generation launcHedmost important goal for the company was the mass deployment of the new ingenico terminals generation which development stared in 2010. the new telium2 generation hardware combined with modern software application developed by voicecom ltd ensured the future-proof investment for our customers. lithuanian market was the first where the new terminals were piloted. uab Hansab was the first in baltics to get the first 90 items of mobile iwl-series terminals for taxis and buses for basketball european championship. the new telium2 range terminals were warmly welcomed by our customers and helped us to keep and strengthen the leading position of card payment solutions provider in the baltics. totally ellore delivered more than 4000 card terminal runtime software licenses over the baltics.

new self service solution inteGrationscost and security are important drivers of innovation from a technology provider perspective. the crisis, which some experts assess, continues positively to influence decisions to find alternative applications to traditional services and replace them with more effective self-service solutions positively.

parcel kioskspostal companies around baltics began to install parcel terminals solve the “last-mile issue” – parcel delivery to the customer in exact location and time when they expect to receive it. parcel terminals are automated kiosks that include several lockers where parcels can be left for consumers to pick up or mail carriers to collect. ellore delivered its competence and expert knowledge to integrate card payment functionality based on ingenico unattended devices to estonian post – siuntos 24 and lithuanian post – siuntos 24. in total more than 100 new parcel kiosks with ingenico unattended terminals were installed during 2011.

ticketinG kiosksthe development of second stage for ticketing kiosk solution for tuule liinid, which enables the passengers to buy ferry tickets via self-service was finished last year. the kiosks standalone software was developed by ellore, it supports different passenger ticket types and estonian id-cards with a possibility to identify discount scheme for local habitants. ticketing kiosks were installed by Hansab as to saaremaa and Hiiumaa harbors.

similar card payment featured kiosk application was developed for west tallinn central Hospital. kiosks are taking care of visit fee collection for hospitals and freeing the staff of the routine task of payment collection. kiosk software with standalone card payment application is integrated to medisoft medical information system and provides automatic reporting for the registration desk workers.

otHer inteGrationsthere has been continuous growth for the use of integrated unattended card payment terminals in parking and petrol stations. during previous year we added several new companies to our partners list that had connected their financial software with featured posxml ingenico terminals. new integrations also include new open area self-service parking kiosk system and latvian company ips ltd petrol sales solution for attended and unattended use. in total our card payment terminals have been integrated with more than 30 different software solutions to ensure wide card payment functionality.

future Goalsbeing part of Hansab Group companies ellore contributes to growth of the corporate customers, by developing and providing new solutions across their existing and new markets. furthermore ellore is seeking for a new partners in finance, retail and public sector to bring them added value by delivering quality oriented and value added modern solutions.

“tHe biggest drivers for success HAd been recovering economy, continuous groWtH of cArd trAnsActions volumes And strengtHening security rules in tHe bAltics.”

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last year in a macro-economic environment was quite contradictive. on the one hand there was a rapid economic growth in Hansab Group home markets, but on the other hand the debt crisis, in particular problems in Greece and other south-european countries, creates a lot of uncertainty about the future. according to preliminary figures estonian economy growth in 2011 was 7.6%, for latvia and lithuania the respective figures are 5.5% and 5.9%. rapid growth caused the prices increase, which was over 4% in all baltic countries. already the last quarter of 2011 showed signs of economic slowdown in the baltics and for the 2012, the majority of economic experts are predicting the growth to slow down significantly, and if the most negative scenarios realize, even a small recession. Hansab Group consolidated revenue grew 23% last year compared to 2010. in 2011 Hansab Group consolidated revenue was 17.5 million euros and a consolidated net profit 589 thousand euros (a 47% increase compared to 2010). Hansab Group’s turnover increased because of the group companies activities outside the traditional banking sector – particularly big projects in the retail and public sector. there were also successful new product sales (parcel kiosks, library solutions, pneumatic tube transportation systems, museums presentation equipment, x-ray solutions, etc). positive was also the continuing growth in service revenues, which increased in 2011 more than 20%

and amounted for nearly 30% of the total turnover. the largest part of the turnover growth came from increased sales of companies in lithuania and latvia. uab Hansab turnover increased 51% in 2011 and sia Hansab 41%. sales turnover increased also in other group companies. as Hansab turnover declined 4% over the previous year. at the same time 2010 was a year of preparation for the changeover to the euro and euro-related equipment sales accounted for a substantial part of the as Hansab 2010 annual sales. in 2011 uab Hansab passed in terms of the turnover as Hansab and both companies yielded the largest part of the consolidated turnover respectively 40% and 37%. sia Hansab accounted for 16% of Hansab Group and other group companies 7 % of total turnover. in 2011 the highest net profit of 442 thousand euros was earned by uab Hansab, followed by as Hansab with 328 thousand euros and 140 thousand euros by ellore oÜ. Hansab Group financial performance was negatively affected by tob Hansab with the 119 thousand euros loss and baltic operation services oÜ with 182 thousand euros loss. although the sia Hansab 2011 result was negative, the company managed to reduce losses by more than half, 48 thousand euros. in 2011 Hansab Group financial expenses decreased, total of 133 thousand euros compared to the 154 thousand euros in 2010. cost decrease happened partially due to the decrease of loan

balance and centralized management of cash flow by the Hansab Group. in december 2011 the group account of Hansab group was created in estonia and this should also allow additional cost reduction during 2012. the largest investments of 2011 were introduction of a new version of microsoft dynamics nav in all group companies and the expansion of the office building in estonia. compared to previous year investments were smaller and the group depreciation costs declined 16%, from 417 thousand euros in 2010 to 350 thousand euros in 2011. 2011 ebitda was 1.2 million euros, which is 17% more than the year before (1 million euros). Hansab Group conservative financial policy has ensured strong liquidity of the company. cash flow from operating activities in 2011 was 1 million euros. consolidated assets were at the same level as last year – amounting up to 10 million euros, but there were changes is the structure of balance

sheet – long term loans decreased and share of equity increased to 38%. consolidated return of equity (roe) was 16% and return on assets (roa) of 6%. we believe that Hansab Groups’ conservative financial policy, a flexible cost base and development strategies have created a basis for group sales and profit growth in the future.

financial results

Jaak Õunpuu cfo of Hansab Group

“HAnsAb group conservAtive finAnciAl policy HAs ensured strong continued liQuidity of tHe compAny.”

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consolidated balance sHeetin thousands of euros 31.12.2011 31.12.2010

ASSETS

Current assets

current assets 855 557

trade receivables 1,951 2,210

other receivables 142 199

prepayments 88 189

inventories 2,291 2,086

Total current assets 5,327 5,241

Non-current assets

long-term financial investments 218 240

property, plant and equipment 4,306 4,435

intangible assets 95 12

Total non-current assets 4,619 4,687

TOTAL ASSETS 9,946 9,928

in thousands of euros 31.12.2011 31.12.2010

LIABILITIES AND EQUITY

Current liabilities

loans and borrowings 1,485 1,241

trade and other payables 2,201 2,074

accrued expenses 434 382

tax liabilities 569 755

Total current liabilities 4,689 4,452

Non-current liabilities

loans and borrowings 1,461 1,940

other long-term liabilities 2 14

Total non-current liabilities 1,463 1,954

TOTAL LIABILITIES 6,152 6,406

in thousands of euros 31.12.2011 31.12.2010

EQUITY

share capital 3 3

reserves 3 3

non-controlling interest 121 67

retained earnings 3,162 3,076

currency translation differences -16 -13

net profit for the period 521 386

TOTAL EQUITY 3,794 3,522

TOTAL LIABILITIES AND EQUITY 9,946 9,928

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biomimicry or biomimetics is the examination of nature, its models, systems, processes, and elements to emulate or take inspiration from in order to solve human problems.

through the course of 3.8 billion years, nature has gone through a process of trial and error to refine the living organisms, processes, and materials on planet earth. the emerging field of biomimetics has given rises to new technologies created from biologically inspired engineering in both the macro scale and nanoscale levels. biomimetics is not a new idea. Humans have been looking at nature for answers to both complex and simple problems since our existence. nature has solved many of today’s engineering problems such as hydrophobicity, wind resistance, self-assembly, and harnessing solar energy through the evolutionary mechanics of selective advantages. biomimicry provides innovative design methodologies and techniques to optimize engineering products and systems.

Source: Wikipedia

innovative solutions by nature

revenue by companies

2011

16% sia Hansab

37% as Hansab

1% other

2% tob Hansab

4%bos

40%uab Hansab

in thousands of euros 2011 2010

Revenue 17,476 14,193

other operating income 23 19

Business expenses

Goods, materials, services -10,731 -8,385

operating expenses -2,028 -1,749

labour expenses -3,471 -2,983

depreciation -350 -417

other expenses -51 -53

Operating profit 868 625

finance costs -133 -154

Profit before income tax 735 471

income tax -146 -70

Net profit for the financial year 589 401

equity holders of the parent company 521 386

non-controlling interest 68 15

consolidated income statement

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contacts Head office

Hansab AS TALLINN 11415 Keevise11 Ph.+3726059800 [email protected]

TARTU 50113 Tähe127F Ph.+3727366444 [email protected]

JÕHVI 41533 Jaama14 Ph.+3723370188 [email protected]

PÄRNU 80019 Jalaka4 Ph.+3724431440 [email protected]

KURESSAARE 93812 Rohu5 Ph.+3726661503 [email protected]

KÄRDLA Ph+3725990893 [email protected]

Hansab SIA RĪGA LV-2167 Plieņciemastreet16 Ph.+37167325550 Fax+37167326462 [email protected]

LIEPĀJA LV-3401 Ludviķastreet7 Ph.+37163423455

REZĒKNE LV-4601 Atrīvošanasavenue121b Ph.+37129150787

DAUGAVPILS Ph.+37129230352 [email protected]

VALMIERA Ph.+37126556999 [email protected]

Hansab UAB VILNIUS LT-03154 SavanoriųAve.180a Ph.+37052058800 Fax+37052058811 [email protected]

KAUNAS LT-49423 SavanoriųAve.347 Ph.+37037999252 [email protected]

KLAIPĖDA LT-94102 PremonėsSt.8 Ph.+37046246635 [email protected]

ŠIAULIAI LT-76339 ŽemaitėsSt.43 Ph.+37041201027 [email protected]

PANEVĖŽYS LT-35135 PušalotoSt.38 Ph.+37061514345 [email protected]

Hansab TOB KIEV 01001 T.Shevchenkoper,13/21B Ph.+380443693401 Fax+380442791048 [email protected]

Ellore OÜ TALLINN 11145 Keevise11 Ph.+3726059813 [email protected]

Baltic Operation Services

(BOS) OÜ TALLINN 11145 Keevise11 Ph.+3726836440 [email protected]

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Hansab Group AnnuAl report 2011 / WWW.HAnsAb.com

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hansab_annual_book_2012

Documents

hansab history

director of hansab as16

strategic goal of hansab

project development

annual book

special year

customers complete solutions

director of bos o24