Untitled

ANNUAL REPORT

2021

Our results

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Ctents

CEO comment 4

Board of directors’ report 8

Corporate governance 21

Financial statements Itera Group 28

Financial statements Itera ASA 59

Statement by the Board of directors and the CEO 71

Auditor’s report 72

Shares and shareholders 77

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

CEO Cment 2021

Taking

pole position

In 2021, we delivered one of the best rates of protable

organic growth in our industry while we continued to invest

in digital capabilities to help customers accelerate their

transition to the cloud.

Our strong performance reflects our talented people’s

dedication and hard work in following our core strategy:

Grow People, Grow Customers and Grow Company. We

believe there is a direct link between this strategy, along

with our innovative mindset and entrepreneurial culture,

and the trust of our customers and partners and our ability

to develop and attract great people.

Despite another pandemic year, we continued to sit apart

in the marketplace with an even stronger foundation and

an exciting future as the specialist in creating sustainable

digital business. Digitalisation and sustainability have been

mutually reinforcing during the pandemic, and we are see-

ing positive developments in the market for our services in

all locations. To use a term from Formula 1, Itera has taken

pole position for enabling businesses in various industries

to transition digitally to a more sustainable future.

Best ever performance

As companies embrace digital transformation, our

customers turn to Itera as their trusted realisation partner.

This is reflected in 2021 being another year in which

Itera performed better than ever before. Here are some

highlights:

• Itera was again ranked as one of the top 25 most innova-

tive companies across all industries in Norway for the sixth

consecutive year.

• For our core digital business, we delivered organic revenue

growth of 19% and increased our operating margin, with

“I am condent in our ability to

continue to meet the urgency of

the challenges and opportunities

that lie ahead for our customers

and in our ability to deliver on

the promise of technology in

creating sustainable digital

businesses.”

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

an EBIT margin of 13.0% in 2021. We also

showed 22% organic growth in the number

of employees, with a net increase of 113

employees.

• We invested more than NOK 18 million in

our Digital Factory at Scale and world-class

Cloud Centre of Excellence, which put Itera in

pole position with a full range of services and

capabilities in digital transformation.

• We launched a next-generation AI-based offer-

ing for anti-money laundering (AML) for Nordic

nancial services organisations based on a

strategic partnership with IBM and Red Hat.

• We moved into new ofces in Copenhagen,

Reykjavik, Bergen and Bratislava and opened a

new ofce in Fredrikstad close to Oslo.

• Net cash flow from operating activities was

NOK 70 million. We returned NOK 28 million in

cash to shareholders as a dividend of NOK 0.35

per share, continuing to deliver on our disci-

plined capital allocation model.

Phasing out our own data centres started two

years ago and has had a negative impact on

revenue growth and protability. At the end of

2021, only a few minor customers remain in

our own data center, which will nally be dis

continued at the end of the rst quarter of 2022.

More importantly, we have been growing our

core digital business – with opportunities in

areas such as cloud, data and analytics, and

AI-based industrial digitalisation with digital

twins and automation. We are ready to digitise

all aspects of any business with innovation,

speed, scale, and quality. Our strategy denes

the areas in which we will drive growth, build

differentiation, and enable our business to

create high value every day.

Digital Factory at Scale

Digital transformation underpinned by cloud and

digital technologies continues to drive strong

double-digit growth across our business. As a

tech company, we are well prepared to help our

customers navigate their futures.

It’s now commonly accepted that data is what

fuels digital transformation, but it is articial

intelligence (AI) that unlocks the value of that

data. However, the adoption of AI and data-

driven decision making has been slower than

anticipated. AI is not magic and requires a

thoughtful and well-architected approach.

For example, most AI failures are due to data

preparation and organisation problems, not the

AI models themselves. Success with AI models

is dependent on rst achieving success with how

you collect and organise the data.

In response, we have created a Digital Factory

at Scale for data-driven business with a full

range of services and capabilities for contex-

tualising data and unlocking insights across

legacy systems. We are bringing together all our

capabilities through our Digital Factory at Scale,

from delivering three horizon digital strategies

and cloud transformation journeys to cloud

migration, cloud-native development, data, AI,

application life cycle management and change.

More than technology, the move to the cloud

is about adopting a new operating system for

future data-driven business, opening radically

new ways for companies to work, compete and

drive value. Our customers value the depth and

breadth of our services, our talent for creating

sustainable digital business and our ability to

nd human solutions to complex challenges and

to deliver tangible outcomes.

Increasing the speed of the energy transition

Digitalisation and sustainability are mutually

reinforcing. As an example, transforming the

world’s energy system from fossil-based to

renewable-based energy sources is one of the

key challenges in terms of creating a low-

emissions society. The push for decarbonisation

towards netzero is a unique opportunity to

transform the energy system by modernising

the ageing energy infrastructure and investing

in new technology to operate more efciently

and develop new business models and growth

opportunities.

According to research by the Royal Society in the

UK, existing digital technology, from smart sen-

sors to advanced cloud services such as machine

learning and articial intelligence, is estimated

to contribute to onethird of the required carbon

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

“sitat?”

reduction by 2030. The Nordic region is often

regarded as a digital and sustainable front-

runner well-positioned to show the way globally.

Through our strategic partnerships with DNV,

Cognite, Microsoft and IBM and Red Hat, we are

building new digital capabilities for the future

energy system. For instance, using our Digital

Factory at Scale and Cloud Center of Excellence

we are developing data-driven utility asset man-

agement solutions to optimise the electric grid in

the western part of the United States. With these

new solutions, equipment failure is minimised,

while the equipment life is optimised. The

results are seen in improved efciency, lower

emissions and reduced costs, with maximum

uptime and reliability of service reliability for

end-users.

Looking Ahead

We enter 2022 with an even stronger founda-

tion and an exciting future as the specialist in

creating sustainable digital business. We are

very focused on capturing the market opportuni-

ties, coupled with empowering our great people

and the disciplined execution that we expect of

ourselves.

I am condent in our ability to continue to meet

the urgency of the challenges and opportunities

that lie ahead and in our ability to deliver on

the promise of technology in creating sustain-

able digital businesses. More than ever, we

are committed to showing the world how to

become more sustainable, create new pathways

for industrial growth and deliver far-reaching

lifestyle changes through digitalisation. As a

Nordic-based company with global reach, we will

seek to show the way.

From day one of the Russian invasion on 24th

February 2022, our primary focus has been on

the safety of Ukrainian employees and their

families. We have updated our business conti-

nuity plans for personnel and operations for any

new situation. But most of all, we admire our

Ukrainian colleagues. In an almost unimaginable

situation, their focus has been on resuming cus-

tomer deliveries as soon as they have ensured

that they and their families are safe.

Indeed, our distributed delivery model and our

consultants’ high level of mobility enable us to

work from anywhere as needed, including with

home as part of the new normal hybrid model

following the pandemic, with consultants con-

tinuing to be able to work at other Itera ofces

in the western part of Ukraine, as well as in

Slovakia and the Nordics. As a result, most pro-

jects have been running more or less as normal

through the rst phase of the war. We want to

thank both our customers and partners for the

strong support and warm compassion they have

shown us. It means a lot to us.

I want to thank all our people for their incredible

dedication and commitment to following our

vision to “make a difference” every day. I would

also like to warmly thank our customers, strate-

gic partners, board of directors and shareholders

for their continued trust and support.

Arne Mjøs

FOUNDER & CHIEF EXECUTIVE OFFICER

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

The company

Itera (the Group) is a specialist in creating

sustainable, digital business. We are uniquely

able to bring digital to the core of their business

because of our full range of services in strategy

and consulting, customer experience, tech nology

and cloud operations. The company utilises its

solid and multidisciplinary skills in business,

customer experience and technology to design,

develop and operate innovative digital solutions

for Nordic-based customers.

Technology is the single biggest driver of change

at companies today. The Nordic region, where

most of our customers are present, is often

regarded as a digital and sustainable pioneer

well-positioned to show the way globally. We

arefully committed to something bigger than our-

selves around the world. We consider ourselves

to have a responsibility to show the world how to

become more sustainable and to demonstrate

new pathways for industrial growth and far-

reaching lifestyle changes through digitalisation.

The Group also owns two niche SaaS companies

with primarily subscription-based recurring

revenues: Cicero Consulting, which provides

advisory services and solutions to the banking

and nance sector, and Compendia, which

specialises in products and services for the HR,

quality and management areas. Both companies

using Itera’s digital capabilities with increasing

cross-business opportunities.

The Group is headquartered in Oslo and has

ofces also in Bergen, Bryne and Fredrikstad

in Norway, Copenhagen (Denmark), Stockholm

(Sweden), Reykjavik (Iceland), Kyiv and Lviv

(Ukraine) and Bratislava (Slovakia). We com-

bine strategic partnerships with customers and

partners, our entrepreneurial culture, and our

innovation mindset to serve customers in more

than 20 countries worldwide from our ten ofces

across the Nordic region and Eastern Europe.

The flexi bility of our distributed delivery model

makes local presence less essential or even

non-critical. The company will consider opening

regional ofces if the opportunity is qualied as

offering substantial, long-term value.

Our strategy

The core of our growth strategy is: Grow People,

Grow Customer and Grow Company. We are

energised by the opportunity to guide and sup-

port our customers in their digital transformation

into sustainable business and to contribute to

the advancement of the societies we live in. Our

strategy denes the areas in which we will drive

growth, build differentiation and enable our busi-

ness to create high value every day.

Key enablers of our growth strategy include:

Our People – Itera is a talent-led organisation.

Attracting, developing and inspiring the very best

talent in our industry is critical to meeting the

evolving needs of our customers and growing

our business. Our people have highly specialised

skills that drive our differentiation and competi-

tiveness. We care deeply for our people and are

committed to a robust entrepreneurial culture

of empowerment and shared consciousness.

We invest in our people to provide them with

opportunities to learn and grow in their careers

through their work experience and continued

development, training and reskilling. We help

them achieve their aspirations both profession-

ally and personally and have a strong commit-

ment to inclusion and diversity.

Our Capabilities – As ONE Itera, we share the

same values, and we are continuously devel-

oping our cross-border methodology, practices

Board of directors’ report

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

and collaboration. We are committed to nding

human solutions to complex challenges through

digital transformation by constantly innovating

and developing leading-edge ideas and lever-

aging emerging technologies to anticipate our

customers’ needs. Our culture is underpinned by

our core values and Business Framework, which

are key drivers of the trust our customers and

partners show us.

Our Foundation – Our growth model, which

leverages our strong customer-centric approach

with a mix of local and cross-border sales

and customer experience, enables us to be

close to our customers, people and partners

to scale efciently. We leverage our scale and

international footprint, innovation capabilities,

and strong partnerships through our Digital

Factory at Scale and Cloud Centre of Excellence

to consistently deliver tangible value for our

customers worldwide.

Market conditions

As we have seen over the past two pandemic

years, digital adoption curves are accelerating

across industries and business functions. All our

customers are on a journey to becoming digital

businesses and thus more agile and resilient.

Digital transformation underpinned by cloud and

digital technologies continues to drive strong

double-digit growth across our core business.

While customers’ digital transformations are

creating momentum within our business, most

companies are at an early stage in their trans-

formation. All face multi-year journeys because

transitioning to the cloud and adopting new tech-

nologies across companies represents a profound

transformation. Simultaneously, we are seeing an

ongoing exponential change in technology that is

accelerating and will create new opportunities,

disruption and change for our customers.

We are seeing all emerging technology become

digital capabilities in the cloud as a dynamic

continuum from public and hybrid cloud to edge

and everything in between. Every company will

need to be a technology company in its own

right, and data will be the key to success for such

companies.

Similarly, sustainability is a critical area in

which technology is still evolving. We need to

x the climate, and we believe that we have a

social responsibility as a tech company to do

our part. We believe that every business must

be a sustainable business. Most companies are

in the early stages of guring out how to make

this shift. Digital technology is uniquely suited

to this time as it can help people, organisations,

and entire industries make all the difference for

our climate. It is part of our mission to help our

customers do just that.

Customers and projects

Itera has a strong customer portfolio in

Business-to-Customer (B2C) markets, such as

banking and insurance, retail and public sector,

and in business-to-business (B2B) markets, such

as the green transition of the oil and gas indus-

try, power & utilities, shing and other heavy

assets industries.

We help customers digitalise their business

toachieve higher efciency, improved customer

satisfaction through new and personalised

products and services, greater customer loyalty,

a stronger brand, a better reputation, and

stronger barriers against competitors, which

contribute to additional sales and increased

protability.

A key part of Itera’s strategy is maintaining

and developing its largest, strategic customer

relationships. In 2021, several new, exciting

relationships were developed with customers

such as Eviny, Aize and Sector Alarm. These

join the strong brands that have continued their

long-lasting relationship with Itera, including

Santander Consumer Bank, Gjensidige, DNV,

Cognite, Aize, Storebrand and Össur.

The share of revenue from Itera’s top 30

customers was 76% in 2021, up from 75% in

2020. New customers, dened as customers

won in the last 12 months, accounted for 13%

ofrevenue in 2021.

Hybrid working environment

We continued to meet our customers’ strong

demand, adding a net 113 talented people to our

core digital business in 2021. We are increasing

the attractiveness of our brand by positioning

ourselves as a leader in the area of Industry 4.0.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

1111

We have expanded our recruitment activities

to support our growth ambitions. We provide

attractive careers, exciting projects with lead-

ing customers, and a flexible, transparent and

diversied culture. We also opened a regional

ofce in Fredrikstad, for which several new hires

were signed.

We are also using the pandemic to learn about

new ways of working. According to our research,

most employees want flexible remote working

options, but at the same time, they also wish

to have more in-person collaboration. This is

hybridworking.

Our people will work in the ofce, from home

andat customer sites, and many of our

customers’ employees will likely be doing the

same. We want to create an environment that

helps our people grow as best they can and

feel a sense of belonging. We will take a lean

approach to nd the best solution for our people,

customers, and company and dene a new

hybrid working environment for Itera.

Our approach to sustainability

Itera’s ambition is to be the market leader at

creating sustainable digital business. By devel-

oping and delivering technology projects, we

contribute to a sustainable future. The World

Economic Forum states that 70 per cent of the

UN’s 17 Sustainable Development Goals can be

solved using technology. That is why we say that

digitalisation and technology are our main contri-

butions to increased sustainability.

Sustainability is an integral driver of our strategies,

and we have prioritized the following Sustain-

able Development Goals (UN SDGs) as those

to which our core business can make a positive

contribution:

• 9. Industry, Innovation and Infrastructure

• 11. Sustainable Cities and Communities

• 12. Responsible Consumption and Production

Itera wants to be at the forefront when it comes

to gender equality and diversity, and from 2022

we have also chosen to prioritize UN SDG num-

ber 5: Gender equality.

Itera aims to conduct business and report in

accordance with the ESG system and therefore

our ambition is to measure sustainability in

three specic categories: environmental, social

and governance. Itera has also signed the 10

principles contained in the UN Global Com-

pact, and Itera Norway is certied as an ECO

Lighthouse.

Financial results

Itera’s core digital business continued its

high growth and margin expansion. In 2021,

revenue grew by 19% to NOK 593 million and

the operating margin improved from 11.9% to

12.9%. Our resilient protable growth reflects

the trusted long-term relationships we have with

our customers and partners, our world-class

distributed delivery model, the breadth of our

services, and our great people and their deploy-

ment into multi-disciplinary teams with special-

ists in customer experience, specic business

domains and advanced technology.

Itera continued the sunsetting of its data

centreoperations and this business line

decreased by 66% to NOK 40 million and

incurred an operating loss of NOK 18.4 million.

The data centre operations were nally discon-

tinued at the end of the rst quarter of 2022. In

parallel with closing down its own data centres,

Itera has invested heavily in a new Cloud Centre

of Excellence and migrated several of the

on-premise data centre customers to the cloud.

Investments into this totalled NOK 18.5 million

in 2021.

The Group’s consolidated operating revenue for

2021 totalled NOK 633 million as compared to

NOK 615 million in 2020. The growth came rst

and foremost from Itera’s success in distributed

deliveries, where it combines customer proximity

with highly scalable and costefcient deliveries

from the Group’s nearshore centres in Ukraine

and Slovakia. Itera has for more than a decade

created a seamless delivery model with a com-

mon culture and operating model across coun-

tries. This has enabled the Group to run agile

and innovative digitalisation projects for Nordic

customers with as many as 70–100% of the con-

sultants delivering remotely from our nearshore

centres. Itera’s experience of using distributed

teams has been particularly useful in the last

couple of years when the Covid-19 pandemic

has required such a modus operandi to be used

by all customers and for all projects.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Operating revenue in Norway was NOK 581

million as compared to NOK 568 million in 2020,

representing an increase of 2%. This includes

revenue from customers outside of Norway that

are served by the Norwegian Group entities. Itera

registered a legal entity in Iceland towards the

end of 2021 and will move its Icelandic customer

engagements to this entity in 2022. Operating

revenue in Denmark increased by 2% to NOK

48.3 million from NOK 47.2 million in 2020.

The Group’s operating result before depreci-

ation and amortisation (EBITDA) was a prot

of NOK 87.1 million as compared to a prot of

NOK 105.1 million in 2020. This represents an

operating prot margin before depreciation and

amortisation of 13.8%, as compared to 17.1%

in 2020. Payroll and personnel expenses were

NOK 434.7 million in 2021, which represents an

increase of 11% from 2020. The increase was

mainly due to growth in the average number of

employees compared to 2020. Other operating

expenses amounted to NOK 48.2 million in 2021

as compared to NOK 46.0 million in 2020. Total

depreciation, amortisation and write-downs

were NOK 28.5 million, a decrease of 33%

from2020.

The Group’s operating result was a prot of

NOK58.6 million in 2021 as compared to a prot

of NOK 62.6 million in 2020. The reduction in

prot was solely due to the sunsetting of the

data centre operations.

Net nancial items were NOK 1.2 million

ascompared to NOK 0.8 million in 2020.

The Group’s result before tax was a prot of

NOK57.4 million as compared to a prot of

NOK61.8million in 2020.

Tax expense totalled NOK 13.3 million in 2021

as compared to NOK 13.2 million in 2020. Tax

payable in 2021 was NOK 7.3 million as com-

pared to NOK 12.7 million in 2020.

The result for the year was a prot of

NOK44.1million as compared to a prot of

NOK48.6million in 2020.

The Board of Directors is satised with the

progress achieved by Itera in 2021 in terms of its

nancial results. Its core digital business is deliv-

ering higher growth and better protability than

many of its peers. Contractual commitments

have made the amount of time and cost to exit

the data centers higher than was anticipated.

However, Itera has gained invaluable insight into

cloud migration and retains signicant compe-

tence in hybrid cloud operations.

It is the opinion of the Board of Directors that

the annual accounts provide a true and fair view

of the Group’s activities in 2021 and its nancial

position at the end of the year.

Research and development

Itera invested NOK 18.1 million in a Cloud

Centre of Excellence during 2021 based on best

practices from Microsoft. Expenditure of NOK

5.2 million relating to the development of new

solutions was capitalised in 2021 as compared

to NOK 5.7 million in 2020. This was related to

further development of the ComPublish solution

and the embedded chatbot functionality.

The expenditure on research and development

was capitalised as it was incurred since it was

considered that the requirements for capitalisa-

tion were met. The solutions principally relate

to contracts entered into that have xed future

revenue associated with them or with demon-

strated commercial interest.

Cash flow and nancial position

Itera generated cash flow from operating activities

of NOK 69.7 million in 2021 as compared to NOK

99.2 million in 2020. The Group paid shareholders

a dividend totalling NOK 27.9 million in 2021. At

31 December 2021, Itera had a cash balance of

NOK 37.5 million as compared to NOK 54.4 million

at 31 December 2020. The difference between

cash flow from operating activities and the Group’s

operating prot is primarily due to depreciation

costs that have no effect on cash flow, but also

reflects tax payments and nancing costs.

In addition to the investment made in research

and development, NOK 7.5 million was invested

in 2021 in hardware and xtures etc. as com-

pared to NOK 4.6 million in 2020. Itera nances

its investments through generation of cash flow

from operations.

Total assets at 31 December 2021 amounted to

NOK 221.1 million (NOK 224.4 million). Non-

current assets were NOK 86.3 million (NOK 82.8

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

1313

million). Accounts receivable were at NOK 76.1

million (NOK 67.3 million).

The Group’s equity at 31 December 2021 was

NOK 39.5 million as compared to NOK 34.3 mil-

lion at the same point in 2020. This represents

an equity ratio of 17.9% as compared to 15.3%

at the same point in 2020. Long-term lease

liabilities totalled NOK 20.0 million (NOK 25.0

million). Other current liabilities were NOK 63.1

million (NOK 51.9 million).

Itera held 1,637,006 of its own shares with a

market value of NOK 25.0 million at the end of

2021, while at the end of 2020 it held 1,269,136

own shares.

Financial risk

The Group is exposed to currency risk, liquidity

risk and credit risk. The Group’s executive

management team and the Board of Directors

monitor these risk factors continually and take

action as required.

The revenues and expenses associated with

Itera’s activities in the Nordic region are denom-

inated in Norwegian kroner (NOK), Danish kroner

(DKK), and Swedish kronor (SEK). Changes

in the exchange rate of the Norwegian krone

against the Danish krone and the Swedish

krona therefore affect the Group’s results. This

risk is limited by the fact that the majority of

associated expenses are also incurred in these

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

currencies. The Group is also exposed through

its near shoring activities in Ukraine and Slovakia

to expenses in American dollars (USD) and

euros (EUR). The currency risk associated with

this is limited by the fact that the prices Nordic

customers are charged for these services are

largely adjusted on a monthly basis in accord-

ance with changes in the exchange rates.

The Board of Directors considers the Group’s

liquidity situation to be satisfactory and does not

regard it as necessary to take further measures

to reduce the Group’s liquidity risk.

The Group has historically incurred very low losses

on receivables. This trend continued in 2021.

Business risk

The Group has deliveries worldwide and ofces

in multiple locations in Europe and assesses and

manages risk at the country and delivery level.

Itera closely monitors and manages country

risks, local nancial and social regulations and

developments, and has a zero-tolerance policy

on corruption. It does not carry out any domes-

tic activities in countries where the problem of

corruption is at its greatest. Best practice data

security procedures and checks have been

implemented at the Group together with a legal

framework that safeguards data security and

intellectual property across national borders.

The NOK has continued to trade at historically

quite low levels against USD and EUR. This

has had a negative impact on the differential

between rates from Norwegian and distributed

deliveries. However, a general shortage of supply

of IT services in the Nordics and more and more

customers gaining rsthand experience of

working with distributed teams and seeing how

effective this can be, has lead to a sharp increase

in the demand for Itera’s acclaimed distributed

delivery model.

Quality policies and approaches help Itera to

achieve high levels of customer satisfaction,

employee engagement and protable growth.

Itera applies a quality management frame-

work combining world-class standards with its

business models. Certicates and authorisa-

tions such as ISO 27001 and BCR-P (Binding

Corporate Rules for Processors) are examples

of these. Itera’s quality assurance team con-

ducts internal audits of adherence and value of

framework practices to continuously develop

the Group’s capabilities. The management of

non conformities and the quality improvement

process ispart of Itera’s quality approach.

Corporate risk management is performed at the

Group level. This includes risk assessments,

risk approval and reports on risk management

and mitigation for the Board of Directors. Risk

management is also performed for deliveries

tocustomers and internal projects.

In late February of 2022, Russia started a mili-

tary invasion of Ukraine. Itera’s primary concern

was to facilitate the safety of its employees and

their families. Itera supported their relocation to

the western region of Ukraine into its Lviv ofce

as well as to other countries. Once they were

safe, Itera’s employees immediately focused on

customer deliveries. The temporary disruption

to Itera’s services delivered from its Ukrainian

employees was relatively minor, circumstances

taken into consideration. Itera has solid business

continuity plans that enable it to act quickly

in a state of emergency like this and minimise

business disruption.

2021 saw the continuation of the Covid-19

virus outbreak. Itera is used to operating with

a distributed work force and has maintained

productivity levels that have been on par with

or better than before the pandemic. If anything,

in 2021 the pandemic had a positive impact on

the demand for Itera’s digitalisation services.

The Group has developed contingency plans to

mitigate any major reduction in business volume

or availability of delivery personnel should

theyoccur.

Organisation

The Group has a strong portfolio of customers

in the Nordic region, where many customers are

served from more than one of Itera’s locations.

Itera strengthened its progress in this area in

2021 by further expanding its distributed deliv-

ery units and resources across the entire Group.

The Group’s headcount at 31 December 2021

was 648 as compared to 569 at the end of 2020.

The average number of fulltime equivalent posi-

tions at the Group in 2021 was 594 as compared

to 538 in 2020.

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Content CEO comment Board of Directors Our results

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The proportion of Itera’s capacity that is located

nearshore (its nearshore ratio) was 53% at the

end of 2021 as compared to 49% at the end of

2020. The Group’s delivery centres in Ukraine

and Slovakia provide signicant scalability and

cost- effectiveness in what is a heated market for

digital business.

Absence due to sickness in 2021 was 3.2%,

which the Board considers very satisfactory,

especially during the Covid-19 pandemic. No

accidents or injuries occurred during the year.

The Board considers the working environment

to be good. Surveys are regularly carried out to

assess the Group’s working environment.

The Board wishes to warmly thank everyone at

Itera for their continued hard work, passion and

dedication to our customers and our business in

2021 in what was another trying year for them

and society at large given the continued lock-

downs and social restrictions. The Board is now

naturally deeply concerned about the well-being

of Itera’s fantastic Ukrainian employees, who

have impressed with their resilience, dedication

and ghting spirit.

Social responsibility

Itera recognises that it has a responsibility to the

society of which it is part and seeks to contribute

to the positive development of those areas of

society that are most related to its activities.

The Group’s ethical guidelines describe the

standards that apply to the Group’s relationships

with customers, suppliers, the public authorities

and its own employees.

Further information on Itera’s ethical guidelines

– The Itera Business Code of Ethics – is available

at https://www.itera.com/en/investor-relations.

Corruption

Itera does not tolerate any form of corruption.

The Group is exposed through its nearshore

activities in Ukraine to a certain level of corrup-

tion risk as the country has a low score on the

Transparency International Corruption Index.

Itera has therefore decided to protect the Group

from this risk by not delivering services to the

public or private sectors in Ukraine where the

problem of corruption is principally found, and

by only exporting its services to countries where

western business standards are the norm.

The Group has guidelines for all employees con-

cerning the acceptance of gifts and other bene-

ts or advantages. The Group’s ethical guidelines

can be consulted for further information.

Security and privacy

Underpinning the Itera Business Strategy and pol-

icies, the Group has implemented a security and

privacy framework applicable to all business units

and subsidiaries. Security and privacy as subject

matters include privacy, data protection, informa-

tion security and cyberse curity. Itera’s security

and privacy framework forms the foundation for

both its deliverables to customers and its own

operations. This applies to all processes, practices,

technology and organisation, and the objective is

to ensure compliance with laws and regulations,

policies, and guidelines. As part of our efforts to

achieve compliance, Binding Corporate Rules for

Processors (BCR/P) and Standard Contractual

Clauses (SCCs) as mandated by respectively by

Article 47 of GDPR and Article 46(1) and Article 46

(2)(c) of Regulation (EU) 2016/679 respectively,

have been developed and approved by the local

Supervisory Authority. The BCR/P allows for the

transfer of customers’ personal data and SCCs

allow for the transfer ofinternal personal data for

processing outside of the EU/EEA, and in Itera’s

case, this is Ukraine.

Itera’s nearshore activities are fully integrated

with its Nordic activities, and the entire Group,

therefore, follows the same procedures and

ethical standards. The Group operates a cloud-

based infrastructure with the CCoE (Cloud Center

of Excellence) as its core infrastructure, enabling

it to manage internal as well as customer

resources either within the CCoE or in customer

tenants. All cloud-based services and resources

are located within the EU/EEA in line with laws,

regulations and customer requirements.

Financial processes are carried out by a central

function with a team located in Norway and

Ukraine.

All employees that are part of the Group’s

nearshore activities have signed condentiality

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

agreements that include undertakings in respect

of data processing and other security arrange-

ments. There are also DPAs and BCR/Ps among

all Itera companies and locations.

Integrity and general legislation

Itera complies with the national legislation and

regulations of all the countries in which it oper-

ates. All its employees are encouraged to report

internally any situations in which they have

concerns with regards to the Group’s integrity or

where they are aware that laws or regulations

are being breached. Employees can make such

disclosures condentially if they so wish, and

the Group will not take adverse action against

whistle-blowers, regardless of whether the con-

tent of the disclosure is found to be true or false.

Human resources

Equality

Itera regards gender equality as important. It

believes that women and men should be given

the same remuneration and the same personal

and professional development opportunities.

The Group seeks to ensure employees of both

genders are able to combine their work and

home lives, and therefore offers maternity and

paternity leave arrangements, home ofce solu-

tions and part-time positions to support this.

30% of the Group’s employees in 2021 were

women as compared to 32% in 2020. The

Group’s core management team consisted of

seven men and two women in 2021. The share-

holder-elected Board members are two women

and two men, while the employee-elected

representatives and observers are two women

and two men.

There are large differences in the proportion of

women employed in the Group’s various areas

of expertise. The proportion of women is lower

in technology-focused areas in development

and operations, while the proportion of women

is higher in areas that are more specialised

in consultancy, communication, content and

testing. More than 71% of the parent company’s

employees are women. There is an uneven

distribution of men and women in management

positions. The Group has a goal of improving this

balance in its management groups.

Diversity

Itera regards diversity in the Group as impor-

tant and seeks to recruit, develop and retain the

best employees regardless of gender, ethnicity

or disability. Itera strongly believe diversity

and inclusion make a difference for Itera, our

customers and society. The Group believes

in all our individual uniqueness as the driving

force for our winning team and the growth of

our customers and people. We believe a diverse

culture is a sustainable culture.

Itera’s diversity framework was implemented

in 2021 to address diversity and inclusion. Itera

will focus on three high-level areas of diversity

and inclusion: ensuring representation of diverse

talents, enabling equality of opportunity through

fairness and transparency, tackling microaggres-

sions and promoting multivariate diversity. The

Group’s ethical guidelines also serve to promote

diversity and prevent discrimination. For more

information, see https://www.itera.com/en/

investor-relations.

Human rights

Itera is committed to ensuring internationally

recognised human rights, such as those dened

in the United Nation’s Universal Declaration of

Human Rights and other UN conventions, are

respected. No one shall in any way contribute

to an individual’s human rights being breached

or circumvented. The Group places special

emphasis on ensuring that employees’ funda-

mental rights are respected. Itera has operations

in countries outside Scandinavia, specically

Ukraine and Slovakia, and considers that the

establishment of these workplaces has con-

tributed to increasing the living standards of its

employees in these countries.

Employee engagement

Itera does not measure employee satisfaction

but employee engagement, as we are of the

view that this is a strong indicator of employee

wellbeing. The engagement score is an over-

all indicator of how engaged our employees

are. Employee engagement is measured every

two weeks through a digital survey consisting

of around 10 questions. Each employee gives

his/her score and feedback on a wide range

of relevant topics, such as his/her work-life

balance, professional development, workload

and adherence to Itera’s values. Employees are

given the opportunity to share their opinion on

which areas and measures should be prioritized

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Content CEO comment Board of Directors Our results

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in order to improve the results. Based on the

input from our employees, different levels

of analysis are made and different actions to

improve engagement activated. Measures that

are assumed to have an effect for several parts

of the organiszation are implemented under the

guidance of the Group’s HR function. Measures

that are more locally targeted are carried out by

the department in question under the direction

of the relevant manager.

The overall average engagement score of 8.5

from 2021 surveys shows that employees nd

Itera a good place to work.

The engagement score is an overall indicator

of how engaged Itera’s employees are. It is an

average of scores given on a scale of 0 to 10 in

response to the questions below:

• Engagement – How likely is it you would

recommend Itera as a place to work?

• Loyalty – If you were offered the same job at

another organisation, how likely is it you would

stay at Itera?

• Satisfaction – Overall, how satised are you

working at Itera?

Skills and expertise development

A world in constant evolution means that compa-

nies need to constantly develop the education,

knowledge and skills of their employees to keep

up. A high level of skills and expertise is crucial

to the Group’s competitiveness. Itera works in a

targeted way to develop the skills and expertise

of all its employees with regards to our practice

areas and capabilities as well as our business

framework, entrepreneurial culture, sales and

management. Our different training activities

support the process of continuous improvement

throughout our employees’ careers at Itera.

In 2021 Itera launched a common concept for

competence development: Level Up. To bring the

concept to life throughout the organization Itera

has 5 principles guiding employees every day:

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

1. We develop our skills and expertise together

with our customers!

Our work to develop our skills and expertise is

always customer-driven. We develop our skills

by solving customer challenges using sustain-

able solutions.

2. We share everything – always!

We are committed to making the development

of our skills and expertise visible and available

to everyone. We use accessible channels

and platforms to share information that is

of general interest. This is how we help each

other to improve.

3. We are driven by passion and creativity!

We want our work to develop our skills and

expertise to inspire you. We aim to provide

space for your passion and creativity, with

your efforts making a difference.

4. We grow professionally and personally!

We want our work to develop our skills and

expertise to always contribute to our personal

and professional development. We aim to

build internal and external networks in parallel

with developing our skills and expertise.

5. We prioritize and systematise!

Skills and expertise development will always

be a priority. This means that time will be set

aside for skills and expertise development

regardless of whether or not you are currently

working on a project.

The skills and expertise programs run at Itera

together constitute the “Itera Academy”, which

is the overall structure for all training. The

training available through the “Itera Academy”

is closely linked with the Group’s strategy and

with the various requirements of the business

areas, and ranges from courses on the role

of the consultant for new graduates, through

courses of varying levels on project manage-

ment, system development and user experience,

to management skills training for both new and

experienced managers.

Environment

Itera’s activities only pollute the external

environ ment to a limited extent. The Group’s

environmental impact is principally a result of

its use of energy, business travel and the waste

created by its ofce activities. The Group is

EcoLighthouse certied (recertied for another

three years in 2019), which means it operates

environmentally friendly and sustainable

procedures in areas including business travel,

procurement and waste management.

The Group is headquartered in a BREEAM

NOR certied building. BREEAM is the world’s

longest-established (1990) and Europe’s leading

environmental assessment tool for buildings,

and BREEAM certication is based on a build-

ing’s documented environmental performance

across nine sustainability categories: manage-

ment, health and well-being, energy, transport,

water, materials, waste, land use and ecology,

and pollution. The ofce part of the building has

received an assessment rating of “Very good”.

Other environmental initiatives at the Group

seek to promote the use of organised recycling

schemes for obsolete IT equipment, to reduce

travel by ensuring video meetings are used

as effectively as possible and to encourage

responsible waste management.

All employees have a duty to consider the

environmental impact of work-related activities

and to favour solutions, products and methods

that impact the environment as little as possi-

ble. Details of this can be found in the Group’s

ethical guidelines (https://www.itera.com/en/

investor-relations).

Shares and shareholder relations

The share capital of Itera ASA is NOK

24,655,987 divided into 82,186,624 shares

each with a face value of NOK 0.30 per share.

Itera held 1,637,006 own shares at the end of

2021. The Group has four ongoing share options

programs, the last of which was issued in 2021.

The exercise price for all of these programs

was below the share price at the end of 2021.

In 2017, Itera introduced an annual Employee

Share Purchase Programme, where employees

could purchase shares up to a market value of

NOK 20,000 at a 20% discount. The programme

has been repeated each year since 2017. After

changes in Norwegian tax legislation in 2021,

the programme was changed so that employees

could purchase shares up to a market value of

NOK 30.000 at a 25% discount. The key objec-

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Content CEO comment Board of Directors Our results

1919

tives of these programs are to align the interest

of employees and shareholders, and to give

employees an opportunity to take part in the

value creation and long-term development of

the Group. In total, 130 employees purchased a

total of 268,615 shares through the offering in

2021.

Itera had 2,278 shareholders at the close of

2021. The 20 largest shareholders owned

59.6million shares, which represents 72.5%

ofthe share capital.

An ordinary dividend of NOK 20.5 million was

paid in 2021 based on the Group’s 2020 results,

which is equivalent to NOK 0.25 per share. In

addition, a supplementary dividend of NOK 8.2

million (NOK 0.10 per share) was paid in Novem-

ber 2021. The Board of Directors proposes the

payment of an ordinary dividend of NOK 0.20

per share based on the Group’s 2021 results

andwill also request from the General Meeting

an authorisation to pay an additional dividend

later in the year.

Corporate governance

Itera applies corporate governance that is based

on the requirements of the Norwegian Account-

ing Act and the Norwegian Code of Practice for

Corporate Governance. The separate section on

corporate governance provides more information

on how Itera complies with Section 3-3(b) para-

graph 2 of the Norwegian Accounting Act and the

provisions of the Norwegian Code of Practice for

Corporate Governance. The Board of Directors of

Itera ASA held six board meetings in 2021.

The Board of Directors has two subcommittees,

namely the Audit Committee and the Compensa-

tion Committee. The Audit Committee consists

of two board members and held ve meetings in

2021. The Compensation Committee consists of

two board members and held two meetings in

2021. The Compensation Committee prepares

and makes recommendations to the Board

regarding the CEO’s remuneration. The Compen-

sation Committee acts as an advisory body for

the CEO on compensation-related issues and

other signicant personnel questions related

tothe executive management.

Further information on this area is provided in

the corporate governance report at the end of

this report.

Directors’ and ofcers’ liability

insurance

Itera has signed a directors’ and ofcers’

liability insurance agreement with Gjensidige

covering the board of directors and executive

management. The insurance will cover damages

amounting to NOK 10 million for each incident

and accumulated over the insurance period

(oneyear).

PARENT COMPANY

Financial results

Internal support processes and shared solutions

are structured as Group Functions in the parent

company Itera ASA in areas where this facilitates

signicant economies of scale and synergies.

The scope of Group Functions is managed in line

with the Group’s requirements, and covers areas

such as accounting/nance, HR, communication,

marketing and internal IT. The parent company’s

operating revenue of NOK 46.4 million (NOK

38.1 million) was related to sales of these

services to other Group companies.

The parent company’s operating result was a

loss of NOK 2.8 million (NOK 3.3 million). Its

operating loss reflects the costs of owning the

subsidiary companies.

As the owner, the parent company receives

group contributions and dividends from the

subsidiary companies. In 2021, the parent com-

pany received group contributions and dividends

totalling NOK 46.9 million (NOK 53.4 million).

The parent company’s prot before tax was NOK

43.9 million (NOK 50.3 million) and theprot

after tax was NOK 44.0 million (NOK50.4

million).

Prot allocation

The Board of Directors proposes that the prot of

NOK 44,002 k recorded by the parent company

Itera ASA is allocated as follows:

• NOK 16,437k to ordinary dividend

• NOK 8,219k to supplementary dividend paid in

2021

• NOK 19,346k to other equity

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

The book value of the parent company’s invest-

ments in the subsidiary companies is NOK

116.0 million. The parent company administers

the Group bank account system. The Group’s

positive cash flow also appears as an increase

in the liquid assets held by the parent company

as this shows the combined bank deposits held

in the Group bank account system. The parent

company reports the bank deposits held by the

subsidiary companies in the Group bank account

system as liabilities to Group companies. The

Norwegian companies are also jointly VAT regis-

tered, and the parent company is responsible for

paying VAT on behalf of all these companies. The

total VAT liability is reported as a liability on the

parent company balance sheet but is offset by

intragroup receivables due from subsidiaries.

The parent company’s headcount at the end

of 2021 was 20 compared to 21 at the end

of 2020. 14 of the 20 employees are women.

Absence due to sickness in 2021 was 4.7% as

compared to 4.9% in 2020. No accidents or

injuries occurred during the year. The Board

considers the working environment to be good,

which is supported by the company’s employee

satisfaction score.

It is the opinion of the Board of Directors that the

annual accounts provide a true and fair view of

the parent company’s activities in 2021 and its

nancial position at the end of the year.

Going concern assumption

In accordance with Section 3-3a of the

Norwegian Accounting Act, it is conrmed that

the going concern assumption is applicable and

that the annual accounts have been prepared on

this basis. The forecast for 2022 and the Group’s

equity situation and liquidity situation provide

the basis for the going concern assumption.

Outlook

Future outlook is by its nature associated with

considerable uncertainty related to both external

and internal factors. Itera has a well-founded

strategy and it continues to work in a targeted

way. Its overall strategy of developing larger,

long-term customer relationships, achieving

greater operational efciency and using delivery

models that combine resources from across

the Nordic region and its nearshore locations

remains unchanged. The Group is seeing sat-

isfactory levels of activity in all the markets in

which it is represented and is keeping a close

watch on how market trends are developing.

The Board closely follows the development of

the war in Ukraine and ensures all reasonable

measures are taken to safeguard our impacted

employees and customer deliveries. It is

impressed by the effectiveness of the business

continuity plans that were put to test when the

war broke out. Itera is committed to continuing to

operate its prosperous delivery centres in Ukraine.

Anne Nyseter Perez

Board member

Arne Mjøs

Chief Executive Ofcer

Jan-Erik Karlsson

Board member

Andreas Almquist

Board member

Gyrid Skalleberg Ingerø

Board member

Morten Thorkildsen

Chairman of the board

Marianne Killengreen

Board member

Oslo, 28 April 2022

The Board of Directors of Itera ASA

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Content CEO comment Board of Directors Our results

2121

The Board of Directors and executive management of Itera ASA carry

out an annual review of the principles for corporate governance and

how they function within the Group. Itera provides here an account

of its principles and practice for corporate governance pursuant to

Section 3-3b of the Norwegian Accounting Act and the Norwegian

Code of Practice for Corporate Governance (NUES) as issued on

14October 2021.

Corporate governance

The Norwegian Code of Practice for Corporate

Governance is available on www.nues.no/en/.

A description of how Itera complies with the 15

recommendations set out in the Code of Practice

for Corporate Governance is provided below.

1. Implementation and reporting

on corporate governance

Itera ASA’s principles for corporate governance

ensure an appropriate division of roles and good

collaboration between the company’s owners,

its Board of Directors and its executive manage-

ment as well as satisfactory control of its activ-

ities. This helps to ensure the greatest possible

value creation over time in the best interests of

owners and other stakeholders.

The company’s ethical guidelines address

conflicts of interest, relationships with custom-

ers, suppliers and the media, inside information

issues and other relevant nancial interests of a

personal nature. The ethical guidelines apply to

all employees of the Itera Group.

Itera’s employees increasingly regard non-

nancial incentives as important. Itera’s

manage ment principles therefore contain a

clearset of values for employees to identify with.

Itera also focuses on making social and moral

considerations part of its business processes.

This means that customers or projects may be

rejected on account of their being in conflict

with the Group’s set of values and vision, which

is: “Make a difference”. This applies to all the

contexts in which Itera is present; the aspira-

tion is for Itera’s employees to view working at

Itera as more than just a job, for its customers

to nd real value in collaborating with Itera, for

its owners to receive a greater return from their

investment than would be the case with other

comparable investments, and for the company

to make a positive contribution to economic and

social development the local environments in

which itoperates.

Itera complies with the Norwegian Code of

Practice for Corporate Governance with no

material deviations from the Code’s recommen-

dations, with the exception of the deviations set

out in sections 6 and 14.

2. Business (No deviation

from the Code)

Itera is a specialist in creating digital business,

with communication, technology and innovation

as the core competency tools. Itera delivers

projects and services in cross-functional teams

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

to Nordic organisations that see the instrumental

contribution that innovation, efcient commu-

nication and smart utilisation of technology

can make to achieving their goals. Itera’s core

sectors are banking and insurance, public,

healthcare, the service industry, energy and

utility. The company’s Articles of Association

areavailable on its website (www.itera.com).

The Board monitors the progress of the

company’s ESG strategy and its associated pro-

cesses and reporting. The Board includes these

issues in its discussions relating to strategy, risk

and performance.

The annual report contains details of the com-

pany’s goals and strategies, and the nancial

markets are provided with continual updates

bythe company’s quarterly presentations.

3. Equity and dividends

(No deviation from the Code)

The company’s capital situation is kept under

constant review in relation to its objectives,

strategy and desired risk prole.

The company’s objective is to generate a

competitive return for its shareholders through

dividends and increases in the share price that

is in line with comparable investments. Itera’s

dividend policy is intended to strike a balance

between capital adequacy and providing share-

holders with a reasonable return. The company’s

current dividend policy is to distribute at least

50% of the Group’s adjusted annual prot after

tax. Payment of the annual dividend is depend-

ent on the company’s nancial situation, its

working capital requirements and investment/

acquisition opportunities. The Annual General

Meeting approves the annual dividend based

on a proposal from the Board of Directors. For

2021, the Board of Directors proposes the

payment of an ordinary dividend of NOK 0.20 per

share. The Board of Directors has also resolved

to ask the Annual General Meeting to renew its

authorisation to pay a supplementary dividend

for 2021 if the Group’s nancial situation makes

this possible.

At the Annual General Meeting in 2021, the

Board of Directors was granted authorisation to

increase the company’s share capital by up to

NOK 1,232,799 by issuing for subscription up

to 4,109,331 new shares with a nominal value

of NOK 0.30. The authorisation is effective until

30 June 2022 and replaced the authorisation

approved by the Annual General Meeting held on

25 May 2020. The Board is authorised to waive

the preferential rights of shareholders pursuant

to Section 10-4 of the Norwegian Public Limited

Companies Act. The authorisation also covers

capital increases for non-cash payment or other

special subscription terms pursuant to Section

10-2 of the Norwegian Public Limited Compa-

nies Act. The authorisation also covers resolu-

tions in connection with mergers pursuant to

Section 13-5 of the Norwegian Public Limited

CompaniesAct.

At the same Annual General Meeting, the Board

of Directors was granted authorisation to buy

back own shares up to a nominal value of NOK

1,232,799, equivalent to 4,109,331 shares each

of a face value of NOK 0.30. The authorisation

is effective until 30 June 2022 and replaced

the authorisation granted at the Annual General

Meeting held on 25 May 2020. The authorisation

was used to buy back 1,726,000 shares in May

2021 for the purpose of implementing employee

share purchase programmes.

The Board of Directors as part of its prepara-

tions for the Annual General Meeting carries out

an annual review of whether it should ask for

authorisation from the Annual General Meeting

to increase the company’s share capital and/or to

be allowed to buy back own shares. Any author-

isation is normally granted for one year, and the

basis for such authorisation must be clearly com-

municated at the Annual General Meeting.

4. Equal treatment of shareholders

and transactions with close associ-

ates (No deviation from the Code)

The company is committed to treating all

shareholders equally. There is only one class

of shares. The Articles of Association do not

impose any restrictions on voting rights. Treat-

ing all shareholders equally is regarded as

important. All information liable to influence the

company’s share price is published through the

Oslo Stock Exchange’s information system and

on the company’s website.

The company’s transactions in its own shares

(share buy-backs) are carried out through the

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

2323

stock exchange at market rates, except in cases

of exercising buy-back options in discontinued

employee share incentive programmes.

The Board will normally obtain independent

valuations for any material transactions involv-

ing the company and its shareholders, mem-

bers of the Board, executive personnel or close

associates of such parties.

5. Shares and negotiability

(No deviation from the Code)

Itera shares are listed on the Oslo Stock

Exchange and are freely negotiable. Itera has

one class of shares, and each share equals one

vote at the General Meeting. The shares have no

trading restrictions in the form of Board consent

or ownership limitations. The Articles of Asso-

ciation of Itera ASA contain no restrictions on

negotiability or voting rights and all shares have

equal rights.

According to the conditions in Share Purchase

Programme offered to selected managers and

key personnel in 2018 and 2020, a three-year

lock-in period applies to ownership of the shares

purchased under this programme. Itera has a

buy-back option of the shares in cases where

the employee terminates his or her employ-

ment with Itera within the lock-in period. Itera

considers that such trading limitation does not

cause disturbances in the market due to limited

scope and thus is not in violation of the NUES

recommendation.

6. Annual General Meeting

All shareholders are entitled to participate in

the Annual General Meeting. Arrangements

have been made that allow shareholders to vote

in accordance with their ownership through a

legal representative or proxy. All shares in the

company carry equal voting rights. There are no

ownership restrictions, and the company is not

aware of any shareholder agreements.

Minutes from the Annual General Meeting are

made available using the Oslo Stock Exchange’s

information system and on the company’s web-

site (www.itera.com).

NUES recommends that the Annual Gen-

eral Meeting should vote separately on each

individual candidate for any corporate bodies to

which members are elected. Itera’s practice is

for the entire Board to be elected.

7. Committees

(No deviation from the Code)

Nomination Committee

The Annual General Meeting has established

a Nomination Committee in accordance with

Itera’s Articles of Association. The Annual

General Meeting issues the mandate for the work

of the Nomination Committee. The Nomination

Committee nominates candidates for appoint-

ment to the Board of Directors for consideration

by the Annual General Meeting. The nominations

are required to provide relevant information

about the candidates’ background and inde-

pendence. The Nomination Committee also

makes proposals regarding the remuneration

paid to members of the Board. The remuneration

paid to the Nomination Committee is determined

by the Annual General Meeting.

The members of the Nomination Committee

are Eli Giske, Bjørn Wicklund and Olav Werner

Pedersen. No Board members or Itera manage-

ment employees are members of the Nomination

Committee.

The Nomination Committee publishes an invita-

tion to submit proposals for candidates for elec-

tion to the Board on the company’s website. The

Nomination Committee will also send a letter to

the largest shareholders inviting their proposals.

Audit Committee

The Board has established an Audit Committee

in accordance with Itera’s Articles of Association.

The Audit Committee has two members. Its

mandate is to supervise the company’s reporting

procedures and to assess the effective ness of

internal control and risk management activi-

ties. The Audit Committee is in regular contact

with the auditor and ensures the auditor is

independent. The Audit Committee reports to

the Board. Members of the Board have access

to all relevant documentation as well as to the

minutes of all Audit Committee meetings.

The members of the Audit Committee are

Marianne Killengreen (chair) and Gyrid Skalleberg

Ingerø.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Compensation Committee

The Board has established a Compensation

Committee to develop and coordinate the

Group’s compensation systems. The Compen-

sation Committee has two members – Jan-Erik

Karlsson (chair) and Morten Thorkildsen.

8. Board of Directors: Composition

and (No deviation from the Code)

Itera does not have a corporate assembly. Itera’s

Articles of Association state that the company is

to have a Board of between four and six mem-

bers. The Board currently has six members,

four of whom are elected by shareholders at the

Annual General Meeting. Itera’s employees are

represented by two employee electives and two

observers. Fifty percent of each of the share-

holder and employee elected board members

and observers are women.

It is regarded as important for the Board to be

balanced in terms of its members’ expertise,

experience and backgrounds in relation to areas

that are of relevance to the company’s activi-

ties. It is also desirable for the composition of

the Board to reflect both the company’s own-

ership structure and the need for independent

representatives. The current Board includes

four members elected by shareholders at

the company’s Annual General Meeting, and

its composition satises the independence

requirements set out in the Norwegian Code of

Practice for Corporate Governance. No member

of the executive management is a member of

theBoard.

The Board of Directors held 6 board meetings in

2021 with an attendance rate of 100%.

9. The Work of the Board of Direc-

tors (No deviation from the Code)

The Board prepares an annual plan for its work

with an emphasis on targets, strategy and

implementation. In addition, the Board has

a formal mandate that regulates its areas of

responsibility, its duties and the allocation of

roles between the Board, the Chairman of the

Board and the CEO. The Board receives monthly

nancial reports for the Group as a whole and

for the subsidiary companies, in which the

executive management comments on nancial

performance and nancial position. The Board

discusses the company’s strategy and budgets

at extended board meetings.

The Board will normally obtain independent

valuations for any material transactions involving

the company and its shareholders, members of

the Board, executive personnel or close associ-

ates of such parties.

The Board holds 6–10 meetings a year and

assesses its own work on an annual basis. In

addition, the Nomination Committee make an

annual assessment of each Board member’s

performance and contribution.

10. Risk management and internal

control (No deviation from the Code)

Risk management and internal control are car-

ried out by the Group using a range of processes,

both at Board level and by the Group’s executive

management. The Audit Committee monitors

risk management and internal control on behalf

of the Board in ways that are additional to the

reports and discussions on the issue at Board

meetings.

Risk management

The Board is regularly updated on risk manage-

ment at its meetings, by routine nancial reports

and by the reports produced by the executive

management on the Group’s business activities.

The Board also assesses the need for measures

to be taken in response to risk factors.

The basis of risk management at Itera is that

the CEOs of the companies that form the Group

are responsible for risk within their individual

companies and must therefore have necessary

knowledge and understanding of their compa-

nies’ risk proles, so that these companies can

be managed in a nancially and administratively

responsible way.

The CEO and CFO continually assess the nan-

cial results of the various business areas, the

extent to which they are meeting the objectives

that have been set, critical situations and events

that might influence the future performance of

the company, and whether optimal use is being

made of resources. The CEO and CFO carry out

this work in close cooperation with the manage-

ment of the individual units.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

2525

Internal control

The Board assesses the internal control systems

and considers the most important risk factors

facing the company as part of the budget plan-

ning and budget approval process. The Group

has in recent years pursued a growth strategy

and the Board is committed to ensuring that all

the Group’s activities are covered at all times by

internal control systems.

The senior management of the subsidiary

companies are responsible for ensuring there

are appropriate and effective internal controls

that meet all applicable requirements and are

responsible for ensuring compliance with the

internal control requirements.

Accounting & Finance, HR, IT and Communica-

tions are organised as common Group Functions

across the Group. This ensures there is internal

control across the companies and across

national borders. Accounting & Finance has

implemented shared accounting procedures for

the Group where it has proved efcient to do so,

including in relation to charts of accounts and

reporting. The companies in the Group all use

the same accounting system, which in 2020 was

switched from Maconomy to Microsoft Dynamics

365. A specic approval authority matrix has

been implemented that determines the authori-

sation routines for expenditure, and the approval

of two individuals is required for payments to

be made. The Group Finance Function has a

separate function that manages accounting in

the subsidiary companies. This function is also

responsible for quality control of accounting

information by performing reconciliations and

other checks. Some accounting work is carried

out by the Group’s accounting department in

Ukraine, which currently has four employees.

There were also three full-time positions in the

accounting department in Norway in 2021. In

addition to the accounting department, there

are separate Business Controllers that assist

thecompanies with nancial reporting, analyses,

forecasting and budgets. There is a separate

accounting function in Ukraine and an external

accounting rm servicing the Slovakian branch.

The CFO and the Finance Manager are respon-

sible for continually assessing whether the

accounting routines are functioning as required,

including controlling reconciliations and analys-

ing and monitoring a range of KPIs. The reports

produced by the subsidiary companies are con-

solidated on a monthly basis, and analyses are

carried out as part of the reporting process, with

action taken as required. Reporting is carried out

using the Group’s standard reporting template,

with consolidation being carried out using

spreadsheets.

The CEO and CFO continually assess the nan-

cial results of the various business areas, the

extent to which they are meeting the objectives

that have been set, critical situations and events

that might influence the future performance of

the company, and whether optimal use is being

made of resources. Meetings are held with the

subsidiary companies every quarter to review

these topics and others, and also to consider the

risks related to nancial reporting, over both the

short and long term. The CEO, the CFO, the man-

agement of the subsidiary companies and rele-

vant experts participate in these meetings, which

are led by the CEO. The Group CEO proposes any

riskreduction measures that are required on the

basis of the companies’ nancial reports and any

follow-up meetings that are held.

11. Remuneration of the Board

of Directors (No deviation from

the Code)

The Nomination Committee makes recommen-

dations to the Annual General Meeting regarding

the remuneration paid to the Board of Directors.

The remuneration paid to the members of the

Board is determined by the Annual General

Meeting once it has considered the proposals of

the Nomination Committee. The remuneration

paid to the Nomination Committee is determined

by the Annual General Meeting once it has con-

sidered the proposals of the Board. Information

on the remuneration paid to the members of the

Board and their shareholdings can be found in

the notes to the accounts in the annual report.

NUES recommends that members of Board of

Directors should note participate in any incentive

or share option programme. Employee elected

Board members in Itera may be part of incen-

tive and/or share option programmes in their

capacity as employees. Inclusion in such pro-

gramme may occur prior to or after the employ-

ee’s election to the Board. Itera considers such

inclusion to be independent of and unrelated to

the employee’s Board position and thus not in

violation of the NUES recommendation.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

12. Remuneration of executive per-

sonnel (No deviation from the Code)

The Board has produced guidelines on the

remuneration of executive personnel in accord-

ance with the rules set out in Section 6-16a of

the Public Limited Liability Companies Act. The

Company’s Compensation Committee is involved

in the process of determining the remuneration

paid to executive personnel. Details of the

Board’s guidelines on the remuneration of

executive personnel are set out in a separate

remuneration report.

13. Information and communica-

tions (No deviation from the Code)

The company strives to provide accurate and

sufciently comprehensive information every

quarter, and to be quick to publish it. The com-

pany normally publishes quarterly gures within

seven weeks of the end of a quarter. The compa-

ny’s provisional annual accounts are published in

February. Open quarterly presentations are held

with a webcast made available so that they can

be viewed either live or subsequently.

The notice calling the Annual General Meeting

and the annual report are made available on the

company’s website three weeks prior to the date

of the Annual General Meeting.

The company strives to publish information in

a non-discriminatory and simultaneous man-

ner. The company maintains regular dialogue

with shareholders, analysts and other parties.

The company takes a cautious approach in its

contacts with these parties. The company limits

its communication with investors and analysts

in the thirty days prior to the publication of an

interim report. In addition, the company does

not issue comments to the media or any other

parties about the Group’s results during this

period. This is to ensure all market participants

concerned are treated equally.

14. Take-overs

The Board of Directors is committed to equal

treatment of shareholders and will ensure

openness with respect to any potential takeover

of the company. In the event of a takeover bid

for Itera, the Board of Directors and executive

management will seek to ensure all shareholders

have access to sufcient information for them to

be able to form a position on the bid. The Board

has not issued separate guidelines on how it

would operate in the event of a formal takeover

bid, but it would conduct itself in accordance

with the relevant provisions and recommenda-

tions set out by legislation and the Norwegian

Code of Practice for Corporate Governance. The

Board regards this as sufcient to ensure that

shareholders’ interests are safeguarded in an

equal and proper manner.

The Board will inform shareholders of its opinion

of any bid, and the Board will in connection with

this inform shareholders about whether they

themselves wish to accept the offer should they

have taken a position on it.

15. Auditor (No deviation

from the Code)

The company has elected PwC as its external

auditor. PwC audits all the companies in the

Group that are subject to statutory audit.

The auditor participates in all meetings of the

Audit Committee.

The auditor prepares reports for the Audit

Committee and the Board. These reports include

an audit plan, an assessment of internal con-

trol at the company and a review of signicant

accounting principles and estimates. The auditor

participates in the Board meeting at which the

annual accounts are considered. The auditor

participates in the Annual General Meeting.

Information about the fees paid to the auditor

can be found in the annual report.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

2727

OUR

R ES U LTS

2021

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Contents

Itera Group

Consolidated statement of comprehensive income 29

Consolidated statement of nancial position 30

Consolidated statement of cash flows 32

Consolidated statement of changes in equity 33

Corporate information and basis of preparation 34

Summary of signicant accounting policies 34

Note 1. Overview of subsidiaries 40

Note 2. Segments 40

Note 3. Contract assets, contract costs and contract liabilities 42

Note 4. Earnings and diluted earnings per share 43

Note 5. Other current assets 43

Note 6. Other current liabilities 43

Note 8. Other Operating Expenses 45

Note 9. Salaries and personnel costs 46

Note 10. Share-based remuneration 46

Note 11. Executive personnel 47

Note 12. Pension 47

Note 13. Financial income and expenses 48

Note 14. Accounts receivable 48

Note 15. Non-current assets 48

Note 16. Right-of-use assets and lease liabilities 51

Note 17. Financial assets and nancial liabilities 54

Note 18. Taxes 55

Note 19. Exchange rates 56

Note 20. Cash and cash equivalents 56

Note 21. Shareholders 56

Note 22. Transactions with related parties 57

Note 23. Subsequent events 58

Note 24. Alternative performance measures 58

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Consolidated statement of

comprehensive income

Itera Group 1 January – 31 December

NOK 1 000, except earnings per share Note 2021 2020

Revenues 2 633 062 615 392

Cost of goods and services 63 120 71 820

Salaries and personnel expenses 9,10,11 434 697 392 447

Depreciation and amortisation 15,16 28 467 42 505

Other operating and administrative expenses 8,11 48 176 46 047

Total operating expenses 574 460 552 818

Operating prot 58 602 62 573

Financial income 13 2 424 6 448

Financial expense 13 3 602 7 236

Net nancial income (expenses) (1 178) (788)

Prot before taxes 57 424 61 785

Income taxes 18 13 276 13 152

Net income 44 148 48 633

Total income attributable to:

Shareholders in parent company 44 148 48 633

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Other comprehensive income

Translation differences on net investment in foreign operations 258 79

Total comprehensive income 44 406 48 712

Total comprehensive income attributable to:

Shareholders in parent company 44 406 48 712

Earnings per share 4 0.55 0.60

Diluted earnings per share 4 0.55 0.60

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Consolidated statement

of nancial position

Itera Group 31 December

NOK 1 000 Note 2021 2020

ASSETS

Deferred tax assets 18 4 791 4 916

Intangible assets 15,16 34 826 24 225

Right of use assets 16 30 917 38 263

Property, plant and equipment 15 15 729 15 403

Total non-current assets 86 262 82 807

Current assets

Contract costs 3 4 035 6 851

Contract assets 3 1 120 1 196

Accounts receivable 14, 17 76 092 67 275

Lease receivable - current 16, 17 3 370 -

Other current assets 5 12 794 11 901

Cash and cash equivalents 20, 17 37 457 54 399

Total current assets 134 868 141 621

Total assets 221 130 224 428

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Consolidated statement

of nancial position

Itera Group 31 December

NOK 1 000 Note 2021 2020

EQUITY AND LIABILITIES

Equity

Share capital 21 24 656 24 656

Other equity 14 880 9 685

Total equity 39 536 34 341

Other provisions and liabilities 1 740 715

Lease liabilities - non-current 16, 17 20 036 24 962

Total non-current liabilities 21 775 25 676

Accounts payable 17 18 846 23 169

Tax payable 18 7 278 12 733

Public fees payable 37 136 37 665

Lease liabilities - current 16, 17 15 163 17 636

Contract liabilities 3 18 318 21 291

Other current liabilities 6, 16 63 078 51 917

Total current liabilities 159 819 164 411

Total liabilities 181 594 190 087

Total equity and liabilities 221 130 224 428

Oslo, 28 April, 2022

The Board of Directors of Itera ASA

Morten Thorkildsen Marianne Killengreen Jan-Erik Karlsson

Chairman of the board Board member Board member

Gyrid Skalleberg Ingerø Anne Nyseter Perez Andreas Almquist

Board member Board member Board member

(Employee elected) (Employee elected)

Arne Mjøs

Chief Executive Ofcer

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Consolidated statement

of cash flows

Itera Group 1 January – 31 December

NOK 1 000 Note 2021 2020

Prot before taxes 57 424 61 785

Income taxes paid 18 (13 223) (9 374)

Depreciation and amortisation 15 28 467 42 505

Share option costs 763 (2 491)

Change in contract assets 75 (463)

Change in accounts receivable 14 (8 817) (10 200)

Change in accounts payable (4 323) (669)

Change in other accruals 11 414 14 916

Effect of changes in exchange rates (2 040) 3 168

Net cash flow from operating activities 69 740 99 177

Investment in xed assets 15 (7 492) (4 642)

Investment in intangible assets 15 (25 297) (12 364)

Net cash flow from investing activities (32 789) (17 006)

Purchase of own shares (23 522) (18 242)

Sale of own shares 8 427 7 953

Cash settlement of options contract (978) -

Equity settlement of options contract 3 951 -

Principal elements of lease payments 16 (17 534) (22 608)

Instalment of sublease receivable 3 616 -

Dividends paid to equity holders of Itera ASA (27 853) (47 963)

Net cash flow from nancing activities (53 892) (80 861)

Effects of exchange rate changes on cash and cash equivalents (2) 4

Net change in cash and cash equivalents (16 943) 1 314

Cash and cash equivalents as of 1 January 54 399 53 084

Cash and cash equivalents as of 31 December 37 457 54 399

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Consolidated statement of

changes in equity

Itera Group 31 December

NOK 1 000 Note

Total

paid in

capital

Own

Other

paid

in equity

Cumulative

translation

differences

Other

equity

Total

equity

Equity as of 1 January 2020 24 655 (231) (8 933) 483 30 396 46 370

Net income for the period - - - - 48 633 48 633

Other comprehensive income for the period - - - 79 - 79

Share option costs - - 575 - - 575

Cash settlement of options contract - - (3 067) - - (3 067)

Equity settlement of options contract - 156 2 108 - - 2 264

Purchase of own shares 21 - (478) (17 764) - - (18 242)

Sale of own shares 10 - 172 5 517 - - 5 689

Dividends - - - - (47 963) (47 963)

Equity as of 31 December 2020 24 655 (381) (21 563) 563 31 066 34 341

Net income for the period

- - - - 44 148

44 148

Other comprehensive income for the period

- - - 258 -

258

Share option costs

- - 763 - -

763

Cash settlement of options contract

- - (978) - -

(978)

Equity settlement of options contract

- 185 3 766 - -

3 951

Purchase of own shares

21 - (518) (23 005) - -

(23 522)

Sale of own shares

10 - 223 8 205 - -

8 427

Dividends

- - - - (27 853)

(27 853)

Equity as of 31 December 2021 24 655 (492) (32 811) 820 47 362 39 536

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Corporate

information and

basis of preparation

Corporate information

Itera ASA (the Company) including its subsidiaries (the Group) is a specialist in creating digital

business, with design, technology and innovation as its core competency tools. Itera provides

solutions and services to customers in industries where change and innovation are central to

adapt rapid changes, such as insurance, banking and nance, high tech, energy, media and

public sector. Itera has ofces in Norway, Sweden, Denmark, Iceland, Ukraine and Slovakia.

Itera ASA is a public limited company registered and domiciled in Norway. The ofce address

is Nydalsveien 28, 0422 Oslo, Norway. Itera ASA is listed on Oslo Stock Exchange (ticker

ITERA). Itera ASA is the ultimate parent company of the Group.

The consolidated nancial statements for Itera ASA were approved by the Board of Directors

on 28 April 2022 and are subject to approval by the Annual General Meeting on 24 May 2022.

Basis of preparation

The consolidated nancial statements have been prepared in accordance with the Interna-

tional Financial Reporting Standards (IFRS) and related interpretations as approved by the EU

as in effect at 31 December 2021, and with all additional disclosure requirements pursuant to

the Norwegian Accounting Act as in effect at 31 December 2021. The consolidated nancial

statements have been prepared on the historical cost principle.

The consolidated nancial statements are presented in Norwegian Kroner (NOK). Amounts

are rounded to the nearest thousand, unless otherwise stated. As a result of rounding adjust-

ments, amounts and percentages may not add up to the total.

The most important accounting principles applied by the Group in the preparation of the

consolidated nancial statements are described below. These principles have been applied

identically to all the periods that are presented, unless otherwise stated.

Consolidation principles

Subsidiaries are companies where the Group has a controlling interest. Control is achieved

when the Group is exposed, or has rights, to variable returns from its involvement with the

investee and has the ability to affect those returns through its power over the investee. A

controlling interest is normally achieved when the Group owns, directly or indirectly, more

than 50% of the voting shares in the target company. The results of subsidiaries acquired or

disposed of during the year are included in the income statement from the date when control

is obtained and until the date when control ceases. All intercompany transactions, outstanding

balances and unrealised group internal prots or losses are eliminated.

Foreign currency translation

The consolidated nancial statements are presented in NOK, which is Itera ASA’s functional

currency. Transactions in foreign currencies are initially recognised in the functional currency

at the exchange rate at the date of the transaction. Monetary assets and liabilities denomi-

nated in foreign currencies are translated to the functional currency using the exchange rate

at the reporting date. All exchange differences are recognised in the income statement with

the exception of exchange differences on a net investment in a foreign entity. These exchange

differences are recognised as a separate component of other comprehensive income until the

disposal of the net investment, at which time they are recognised in the income statement.

Non-monetary items measured at historical cost in foreign currency are translated using

the exchange rates at the dates of the initial transactions. The date of initial transaction for

non-monetary assets on which the Group has paid an advance consideration is the date of the

Summary of

signicant account-

ing policies

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

payment of the advanced consideration. The Group has foreign entities with functional cur-

rency other than NOK. At the reporting date, the assets and liabilities of foreign entities with

functional currencies other than NOK are translated into NOK at the rate of exchange at the

reporting date and their income statements are translated at the average exchange rates for

the year. The translation differences arising from the translation are recognised in other com-

prehensive income until the disposal of the net investment, at which time they are recognised

in the income statement.

Key sources of estimation uncertainty - critical accounting estimates

A critical accounting estimate is one which is both important to the presentation of the

Group’s nancial position and results and requires management’s most difcult, subjective

or complex judgements, often as a result of the need to make important estimates based

on assumptions about the outcome of matters that are inherently uncertain. Management

evaluates such estimates on an ongoing basis, based upon historical results and experience,

consultations with experts, trends and other methods which management considers reasona-

ble under the circumstances, as well as forecasts as to how these might change in the future.

Areas of signicant estimation uncertainty include:

Revenue recognition

Itera delivers most of its non-subscription services on Time & Material agreements. However,

it may occasionally enter into xed or target price agreements for development work. In such

cases, the revenue is recognised proportionately to its estimated completion rate and con-

tract value. Completion is measured as incurred hours relative to the estimate to complete

the project. The Group bases its estimates on historical results, taking into consideration the

type of customer, the type of transaction and the specics of each arrangement. As of the end

of 2021, there were no xed or target price projects outstanding which may have represented

any signicant estimation uncertainty. Refer to note 2 for further information.

Impairment of capitalised development costs

Itera has capitalised development costs related to its Intellectual Property Rights (IPR). The

IPR generate monthly subscription revenues over the length of the customer contracts, and

the capitalised development costs are amortised over their estimated useful life. Signicant

technological changes or loss of major customer contracts may impact the remaining useful

life or the fair value of the asset, respectively. The Group conducts impairment tests on the

assets to assess whether there is a need to write down or accelerate the amortisation of the

assets when such triggering factors occur. The current carrying value of the assets are low

compared to the associated revenue generated from this. The Group thus considers the risk of

impairment to be limited.

Share capital, share premium and other equity

Payments for the purchase of own shares are recognised as a reduction in equity and pro-

ceeds from any sales as an increase. Transaction costs directly related to equity transactions

less taxes are recognised against equity as a reduction in the proceeds.

Tangible xed assets

Tangible xed assets are recognised at acquisition cost, less accumulated depreciation and

accumulated impairment losses. Acquisition cost includes expenses directly attributable to

purchasing the asset. Acquisition cost for assets developed inhouse includes direct salary

costs, other costs directly attributable to ensuring that the assets function as intended, and

the costs of dismantling and removing the assets. Gains and losses on disposals of tangible

xed assets are presented as part of the operating prot/loss and calculated as the difference

between the consideration received and the carrying value of the asset.

Depreciation of xed assets

Depreciation and amortisation expenses are based on management’s estimates of resid-

Summary of

signicant account-

ing policies, cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

ual value, depreciation and amortisation method and the useful life of property, plant and

equipment. Estimates may change due to technological developments, competition, changes

in market conditions and other factors and may result in changes in the estimated useful life

and in the amortisation or depreciation charges. Technological developments are difcult to

predict and the Group’s views on the trends and pace of development may change over time.

Critical estimates in the evaluations of useful lives for tangible assets include, but are not lim-

ited to, expected developments in technology and markets. The useful lives of property, plant

and equipment assets are reviewed at least annually taking into consideration the factors

mentioned above and all other important relevant factors. Estimated useful lives for similar

types of assets may vary between different entities in the Group due to local factors such as

growth rate, maturity of the market, history and expectations for replacements or transfer of

assets. A change in estimated useful life is a change in accounting estimate, and depreciation

and amortisation plans are adjusted prospectively.

Tangible xed assets are depreciated on a straightline basis over their estimated useful life.

Leased assets are depreciated over the shorter of the lease term and estimated useful life, unless

it is reasonably certain that the Group will obtain ownership after the end of the lease term.

The estimated useful lives for the current and comparison periods are:

Fixtures and ttings: 510 years

Other xed assets: 3 years

Depreciation methods, useful lives and residual values are reviewed at each balance sheet

date.

Intangible assets

Research and development activities relate to signicant new concepts or solutions. Costs

are capitalised only to the extent that they can be measured reliably, the product or process

is technically or commercially viable, the future economic benets are likely, and the Group

intends and has sufcient resources to complete its development as well as to sell or make

use of it. Capitalised expenses include costs for materials, direct salary costs, and directly

attributable overhead costs. Other development costs are expensed as incurred. Capitalised

development expenditure is carried at cost minus amortisation and impairment.

Intangible assets not yet in use are tested for impairment annually or more often if indicators

of impairment exist, whereas other assets are tested for impairment when circumstances

indicate there may be a potential impairment. Factors that indicate impairment which trigger

impairment testing include the following: signicant fall in market values; signicant under-

performance relative to historical or projected future operating results; signicant changes in

the use of the assets or the strategy for the overall business, including assets that are decided

to be phased out or replaced and assets that are damaged or taken out of use; signicant neg-

ative industry or economic trends; signicant loss of market share; signicant unfavourable

regulatory and court decisions and signicant cost overruns in the development of assets.

Amortisation of intangible assets

Intangible assets are amortized on a straight-line basis over their estimated useful life

from the date they become available for use. The estimated useful lives for the current and

comparison periods are:

Capitalised development costs: 3–5 years

Software and IT equipment: 3–5 years

Leases

At inception of a contract, the Group assesses whether a contract is, or contains, a lease.

A contract is or contains a lease if the contract conveys the right to control the use of an

identied asset for a period in exchange for consideration.

Summary of

signicant account-

ing policies, cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Itera ASA agreements consists of buildings, cars, equipment used in the operating activities

and ofce machines. Cars usually have a lease period of 5 years, while several of the buildings

have a longer time frame. The ofce machines are leased in a 35 year period. Some of the

building leases have extension options and this has been taken into account.

Assets and liabilities arising from a lease are initially measured on a present value basis. Lease

liabilities include the net present value of the following lease payments:

• xed payments, less any lease incentives receivable

• amounts expected to be payable by the group under residual value guarantees

• the exercise price of a purchase option if the group is reasonably certain to exercise that

option, and

• payments of penalties for terminating the lease, if the lease term reflects the group exercis-

ing that option.

The Group recognises a right-of-use asset and a lease liability at the lease commencement

date. The right-of-use asset is initially measured at cost, which comprises the initial amount

of the lease liability adjusted for any lease payments made at or before the commencement

date, plus any initial direct costs incurred. The lease liability is initially measured at the pres-

ent value of the lease payments that are not paid at the commencement date, discounted

using the Groups incremental borrowing rate.

The Groups incremental borrowing rate is the rate that the lessee would have to pay to borrow

the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar

economic environment with similar terms, security and conditions.

Right-of-use assets are generally depreciated over the shorter of the asset’s useful life and the

lease term on a straight-line basis. If the group is reasonably certain to exercise a purchase

option, the right-of-use asset is depreciated over the underlying asset’s useful life.

The Group has elected not to recognise the right-of-use assets and liabilities for short-term

leases of equipment and low value assets. Shortterm leases are dened as 12 months or

less, and low value assets at NOK 50 000 or lower.

Accounts receivable and other receivables

Accounts receivable are recognised in the balance sheet at their nominal value, less a provi-

sion for expected losses. The interest element is disregarded if it is not material. The expected

credit loss on trade receivables and contract assets is measured using a simplied lifetime

model.

Government grants

Grants from the government are recognised at their fair value where there is a reasonable

assurance that the grant will be received and the group will comply with all attached condi-

tions. The Itera Group receives government grants related to SkatteFUNN. Government grants

relating to costs are deferred and recognised in prot or loss over the period necessary to

match them with the costs that they are intended to compensate.

Pension

The Itera Group nances its pension arrangements for employees through collective dened

contributionbased schemes. A dened contribution pension scheme is a plan under which

an entity pays xed contributions into a separate fund or pension fund and has no legal or

constructive obligation to pay any further amounts. Contribution obligations are recognised

as personnel expenses in the prot and loss account when due. Prepaid contributions are

recognised as an asset to the extent that they entail cash refunds or that future payments to

the scheme are reduced.

Summary of

signicant account-

ing policies, cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Share-based remuneration

Employee share options at the Group give employees the right to subscribe for shares in Itera

ASA at a future point at a predetermined price (exercise right). This right as a rule is depend-

ent on the Group achieving concrete targets and the employee still being employed at the time

of exercise.

Employee share options are valued at fair value on the grant date. Their calculated value is

recognised as a personnel expense, with a counter entry to other paidin equity. The cost of

share options is divided over the period until the employee becomes unconditionally entitled

to exercise the options. The expensed amounts are adjusted to reflect the actual amount of

stock options exercised if the associated service and non-market conditions are met.

The social security tax costs associated with employees’ taxable benets are expensed as

incurred over the accrual periods on the basis of the accrual rates and values at the balance

sheet date.

Provisions

Provisions are recognised when the Group has incurred a legal or constructive obligation as a

result of a previous event and it is likely that this will lead to it making a payment or transfer-

ring other assets in order to settle the obligation, and the size of the obligation can be meas-

ured reliably. Provisions are measured at the present value of the expected future cash flows,

discounted using a market-based discount rate before tax.

Revenue recognition

Revenue arising from subscriptions is recognised over the course of the contract period.

Revenue from a transition project that is an integral part of a subsequent operating services

contract is recognised on a linear basis over the period of the latter contract. Revenue from

services is recognised when the hours are delivered. When the contract outcome cannot be

measured reliably, revenue is recognised only to the extent that the expenses incurred are eli-

gible to be recovered. Revenue is measured based on the consideration specied in a contract

with a customer.

Revenue from the sale of goods is measured based on the consideration specied in a con-

tract with a customer. Where the consideration covers multiple sub-deliveries, it is broken

down and recognised when the various components are delivered.

Revenue from contracts with customers

IFRS 15 Revenue from Contracts with Customers is based on the principle of recognising reve-

nue when control of goods or services transfers to a customer. Itera mostly derives its revenue

from the transfer of services over time as opposed to point in time.

Revenue from consulting services rendered that relate to subscription contracts will in some

cases be recognised over the contract period for the subscription contract and not at point in

time when the services are delivered. The costs of fullling a contract, such as costs related to

delivering the services mentioned are capitalised as contract costs if the amortisation period

is more than 12 months. The amortisation period is the expected contract period, including

renewals. Payments from customers for delivering these services are under IFRS considered

prepayments and classied as contract liabilities under current liabilities.

Contract assets, contract costs and contract liabilities

Contract assets comprises earned and recognised revenue that has not yet been invoiced.

Contract assets is transferred to receivables when the rights to payment become uncondi-

tional, which usually occurs when invoices are issued to the customers.

Summary of

signicant account-

ing policies, cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Contract costs comprise expenses related to fullling a contract, typically implementation

costs in the initial stage of a contract, capitalised and expensed over the expected contract

periods.

Contract liabilities comprise prepayments from customers for delivering services.

Cost of goods and services

Cost of goods and services is the costs paid to external suppliers for goods or services directly

related to Itera’s delivery of goods and services. Cost of goods and services includes costs

due to third-party contractors, the rental of software, purchases of software and hardware for

resale, travel expenses for consultants and other costs.

Financial income and nancial expense

Financial income comprises interest income from nancial investments and bank deposits.

Interest income is recognised using the effective interest rate method. Dividends are recog-

nised in prot and loss when they are approved by the annual general meeting of the company

from which they will be received. Financial expense comprises interest expense on borrowings

and changes in the fair value of nancial assets. All borrowing costs are recognised in prot

and loss using the effective interest rate method. Financial income and nancial expense also

comprise foreign currency gains and losses.

Tax expense

Tax expense comprises both tax payable and changes in deferred tax. Deferred tax/tax assets

are calculated on all differences between the accounting values and tax values of assets and

liabilities.

Deferred tax assets are capitalised on the balance sheet when it is probable that the individual

company will have sufcient taxable prots in subsequent periods to be able to use the tax

asset. The individual companies recognise previously non-capitalised tax assets to the extent

that it has become probable that they will make use of them. Likewise, the individual compa-

nies reduce the value of their deferred tax assets to the extent that they no longer regard it as

probable that they will be able to make use of their deferred tax assets.

New standards and interpretations not yet adopted

Certain new accoounting standards, amendments to standards and interpretations have been

published that are not mandatory for the year ended 31 December 2021 and have not been

applied in preparing these consolidated nancial statements. The standards thay may be

relevant to the Group are set out below. These will be adopted in the period that they become

mandatory unless otherwise indicated. These standards, amendments or interpretations are

not expected to have a material impact on the Group in the current or future reporting periods.

Amendments to IAS 1 Presentation of Financial Statements

Amendments to IAS 8 Accounting policies, Changes in Accounting Estimates and Errors

Amendments to IAS 12 Income Taxes

Statement of cash flows

The statement of cash flow is prepared using the indirect method. Cash and cash equivalents

comprise cash, bank deposits and other shortterm liquid investments. Interest paid is pre-

sented as part of operating activities.

Summary of

signicant account-

ing policies, cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

NOK 1000

Country

holding

Result

2021

Equity

31.12.2021

Itera Norge AS

Norway 100% 17 878

28 833

Itera Offshoring Services AS

Norway 100% 10 078

9 699

Cicero Consulting AS

Norway 100% 6 728

10 194

Compendia AS

Norway 100% 6 259

9 112

Itera Sverige AB

Sweden 100% (34)

1 669

Itera ApS

Denmark 100% 3 972

2 949

Itera ehf

Iceland 100% (290)

(259)

Itera Consulting Group Ukraine, LLC

Ukraine 100% 1 812

9 598

Total

46 403

71 796

1) Consolidated pre 2016

2) Consolidated from 2021

The business activities of the Group are carried out by 7 operational companies in 6 countries.

Each company has its own management team and a CEO who is responsible for the company’s

nancial results. Each company also has its own internal structure for management, budget-

ing and nancial reporting, including reporting to the Group CEO. The Chief Operating Deci-

sion-Maker (CODM), who is responsible for allocating resources and assessing performance

of operating units, has been identied as the steering committee consisting of the CEO and

the CFO. The activities carried out by all the subsidiaries are for all practical purposes related

to delivering IT and communication solutions to customers. In particular, the Group utilises

its nearshore delivery capabilities seamlessly across its various operating units and locations.

The reported revenue in 5 geographical reporting segments, from both external customers

and intragroup sales, is less than 12% of the combined revenue. The operating segments in

Norway and Denmark are aggregated into two reporting segments, Core digital business and

Data centre operations. Itera’s data centre operations are being transitioned to the cloud

and will be sunset once the existing customers have been migrated to the cloud or termi-

nated. Once the Data Center Operations have been discontinued in 2022 Itera will only show

geographical reporting segments.

Transactions and transfers between the companies are c arried out on normal commercial

terms.

Revenues from transactions with the two largest external customers in Norway amount to

NOK 72.9 and 69.5 million respectively.

Note

Overview of

subsidiaries

Note

Segments

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Geographical information:

NOK 1 000

2021 Norway Sweden Denmark Ukraine Slovakia Iceland Group

Sales revenue 783 814 - 48 336 14 398 36 531 - 883 079

Intragroup

eliminations (202 609) - - (14 398) (33 010) - (250 017)

Net sales revenue 581 205 - 48 336 - 3 520 - 633 062

Services 439 542 - 39 464 - 3 520 - 482 526

Services 3rd Party 42 339 - 2 726 - - - 45 065

Subscriptions 87 381 - 5 650 - - - 93 031

Other revenue 11 943 - 497 - - - 12 440

581 205 - 48 336 - 3 520 - 633 062

Operating prot 49 934 (34) 5 301 2 093 1 599 (290) 58 602

Investments in

xed assets 29 282 - 195 1 740 1 573 - 32 789

Total assets 195 466 1 671 8 006 11 225 4 594 168 221 130

Total liabilities 169 379 3 6 871 1 102 3 948 292 181 594

2020 Norway Sweden Denmark Ukraine Slovakia Iceland Group

Sales revenue 762 174 - 47 218 14 759 31 382 855 532

Intragroup

eliminations (194 015) - - (14 759) (31 367) (240 141)

Net sales revenue 568 159 - 47 218 - 14 615 392

Services 389 430 - 27 352 - 14 416 796

Services 3rd Party 22 178 - 4 117 - - 26 295

Subscriptions 147 299 - 7 432 - - 154 731

Other revenue 9 251 - 8 317 - - 17 568

568 159 - 47 218 - 14 615 392

Operating prot 56 939 (22) 5 166 (829) 1 319 62 573

Investments in

xed assets 16 882 - 307 1 659 598 19 446

Total assets 202 822 254 7 075 10 871 3 405 224 428

Total liabilities 170 225 1 15 896 1 200 2 766 190 087

Services revenue is generated from rendering of services to customers by Itera’s own consult-

ants. The service contracts are with a few exceptions Time & Material agreements where the

invoicing is based on hours performed at agreed rates.

Services 3d party revenue is generated from rendering of services to customers performed by

subcontractors.

Note

Segments, cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Subscriptions revenue is generated from services provided on regular basis with fees based on

xed amounts or volumes.

Segment information:

NOK 1 000

2021

Core digital business

(95%)

Data centre operations

(5%) Group

Sales revenue 592 956 40 106 633 062

Operating prot 77 079 -18 477 58 602

2020

Core digital business

(95%)

Data centre operations

(5%) Group

Sales revenue 497 634 117 758 615 392

Operating prot 59 177 3 396 62 573

Signicant changes in contract assets

NOK 1 000 2021 2020

Balance, beginning of period 1 196 732

Net additions arising from operations in the period 1 720 1 196

Amounts billed in period and thus reclassied to accounts receivables (1 796) (1 332)

Changes in impairment allowances - 600

Balance, end of period 1 120 1 196

Signicant changes in contract costs

NOK 1 000 2021 2020

Balance, beginning of period 6 851 11 571

Costs capitalised in the period - -

Amortisation (2 816) (4 721)

Impairment losses - -

Balance, end of period 4 035 6 851

Signicant changes in contract liabilities

NOK 1 000 2021 2020

Balance, beginning of period 21 291 37 176

Increases due to cash received, excluding amounts recognised as reve-

nue during the period 15 084 15 637

Revenue recognised that was included in the contract liability balance at

the beginning of the period (18 058) (31 521)

Balance, end of period 18 318 21 291

Changes in contract liabilities for 2020 have been updated due to incorrect classication in

the 2020 Annual accounts.

Management expects that approximately 67% of the transaction price allocated to the unsat-

ised contract obligations as of 31.12.2021 will be recognised as revenue in the 2022 scal

year. The remaining 33% will be recognised in the scal year 2023.

Note

Contract assets,

contract costs and

contract liabilities

Note

Segments, cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

NOK 1000, except earnings per share 2021 2020

Prot for the year 44 148 48 633

Average number of outstanding shares 80 550 80 917

Outstanding employee share options 2 110 1 789

Dilution effect of outstanding share options 399 585

Average number of shares including dilution 80 949 81 502

Basic earnings per share 0,55 0,60

Diluted earnings per share 0,55 0,60

The average share price for 2021 is calculated on the basis of the market closing price for the

Itera share on each trading day (except for days when no shares were traded when the bid

price has been used) was NOK 14.56.

Basic earnings per share calculations are based on the weighted average number of common

shares outstanding during the period, while diluted earnings per share calculations are per-

formed using the average number of common shares and dilutive common shares equivalents

outstanding during each period.

The share option exercise prices are NOK 13.50, NOK 13.91, NOK 11.46 and NOK 10.29 for

2021, 2020 (programme 2), 2020 (programme 1) and 2019 programmes, respectively.

NOK 1 000 2021 2020

Prepaid expenses 7 973 8 548

Other current receivables 4 822 3 353

Total 12 794 11 901

Prepaid expenses in 2021 includes a reclassication of the Group cloud based accounting

system Dynamics 365. The expenses for conguring the software was classied as an intan-

gible asset in 2020. In accordance with IFRIC Update March 2021 NOK 5.5 moved to prepaid

expenses in 2021 as the criteria in IAS 38 were not met. The costs have been capitalised as

the conguration and customisation services are not distinct from the SaaS agreement. The

costs are accrued over the terms of the service agreement, in total 5 years, the same time

period as the initial depreciation period for the asset.

NOK 1 000 2021 2020

Holiday pay 22 912 24 562

Accrued wages and bonuses 25 682 18 334

Accrued other expenses 14 484 9 021

Total 63 078 51 917

Accrued other expenses for 2020 have been updated due to incorrect classication in the

2020 Annual accounts.

Note

Other current assets

Note

Other current

liabilities

Note

Earnings and diluted

earnings per share

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

The Itera Group is exposed to nancial risks such as: credit risk, liquidity risk, currency risk

and interest rate risk. The Group’s exposure to these risks is considered to be low. The Group

has established guidelines to manage its exposure to these risks. The main principle is to

minimize exposure to nancial risks, and the Group accordingly holds no nancial assets or

liabilities for speculative purposes.

The Group’s nearshore operations in Ukraine and Slovakia exposes it to new risks, such as coun-

try risk, IT security risks and the risk of corruption. Itera has a zero-tolerance policy on corruption.

Credit risk

Credit risk is the risk of nancial loss to the Group’s receivables due from customers and other

short-term receivables. In order to manage this risk, the Group has established credit approval

procedures to evaluate the creditworthiness of all material counterparties. The Group’s expo-

sure to credit risk is not dependent on individual customers but customers as a group. The

amount is examined as of every closing date. The provision is supported by historical credit

loss experience of trade receivables, adjusted as appropriate to reflect current conditions and

estimates of future economic conditions.

Information on the Group’s risk exposure in respect of accounts receivable is provided in note

14. The Group’s customers are private and public companies. The Group assesses the credit

worthiness of all new customers and periodically for existing customers.

Liquidity risk

Liquidity risk is the risk that the Group will not be able to meet its nancial obligations as they

fall due. The Group manages its liquidity in such a way as to ensure, as far as possible, that it

will always have sufcient liquidity to meet its liabilities when they fall due without incurring

unacceptable losses or risking damage to the Group’s reputation. The Group has established

an overdraft facility with its banking partner. See note 18 for further information.

In order to accommodate growth in the Group’s operational companies, lease nancing con-

tracts have been entered into for major investments in software and hardware.

The amounts disclosed in the table below are the contractual undiscounted cash flows.

NOK 1 000

Less than

6 months

6–12

months

1–5

years

Over

5 years Total

Balance at 31st Dec 2021

Accounts payable 18 846 - - - 18 846

Leasing liabilities 7 581 7 581 14 552 5 485 35 199

Balance at 31st Dec 2020

Accounts payable 23 169 - - - 23 169

Leasing liabilities 8 818 8 818 20 474 4 488 42 597

Currency risk

The Group is exposed to currency risk through its businesses in Sweden, Denmark, Iceland,

Ukraine and Slovakia. The exposure to currency risk is limited by the fact that businesses in

Sweden, Denmark and Iceland have revenue and costs in the same currency, and in addition

most borrowing is arranged within the Group. Of the Group’s total revenue, 8% is in Danish

kroner (DKK). A 10% change in the NOK exchange rate against SEK and DKK would have a

0.8% effect on the Group’s revenue. The effect of currency deviation on nancial assets and

liabilities denominated in non-functional currency is not material.

Note

Financial risk

management

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

The Group’s nearshore companies operate in three different currencies: USD, Euro and Ukrain-

ian Hryvna. The main exposure is in USD. The Group has to a large extent currency adjustment

mechanisms in its agreements with customers to counteract its exposure to US dollar and

Euros, where service fees for nearshore services are denominated in USD or EUR and con-

verted to NOK at the start of the monthly delivery period.

Interest rate risk

The Group is exposed to interest rate risk in relation to its bank deposits. The Group is also

exposed in connection with lease nancing contracts and when drawing against the overdraft

facility. The Group does not hold any nancial securities or other assets that have an inherent

interest rate risk. The effect on prot and loss of change in interest rate is insignicant.

Fair value

Itera does not have signicant differences between fair value and book value in respect of

nancial instruments, which mainly comprise accounts receivable and accounts payable,

other current receivables and other current liabilities and lease liabilities.

On 24 February 2022, Russia started a military invasion in Ukraine. For further information on

the impact on our nancial statements, refer to note 23.

2021

2020

Facilities 9 332 13 680

Ofce supplies 15 441 10 930

Professional fees 9 669 6 899

Courses 3 653 3 236

Travel and entertainment 1 591 1 981

Sales and marketing 5 263 4 520

Other operating expenses 3 227 4 801

Total 48 176 46 047

Fees to the auditors

NOK 1 000, excluding VAT 2021 2020

Statutory audit of Itera ASA 241 182

Statutory audit of subsidiaries in Norway 299 193

Statutory audit of international subsidiaries 94 -

Audit fees 634 375

Tax advisory services - -

Fees for other certication services - -

Other services provided to subsidiaries in Norway 59 59

Note

Other Operating

Expenses

Note

Financial risk

management, cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

NOK 1000 2021 2020

Salaries 379 664 339 846

Share option costs 611 693

Social security taxes 34 496 30 696

Pension costs 12 114 10 710

Other benets 15 459 13 303

Salaries and personnel expenses capitalised *) (7 646) (2 802)

Total payroll and personnel expenses 434 697 392 447

Average number of employees 594 538

*See note 15

Share option programmes

The Group had ve share option programmes running in 2021. All schemes to be settled in

shares.

The share option programme issued in 2017 expired in June 2021. New share option pro-

grammes were issued late 2019, twice during 2020 and once in 2021. These programmes

have no nancial targets attached, and up to onethird of the options are exercisable after

three years and otherwise rolled forward. All remaining options must be exercised after four

years or otherwise forfeited.

The fair value of the options was calculated on the date they were granted, and the options

granted are being expensed over the accrual periods of four years in accordance with the

graded vesting principle. Fair value is calculated using the Black-Scholes-Merton option

pricing model. The calculation of fair value assumes that historical volatility is an indica-

tion of future volatility. Expected volatility is therefore set equal to historical volatility. The

interest rate is based on rates obtained from Norges Bank for the same period as the life

of the options. For the option programmes, an annual participant attrition rate of 10-20%

were assumed. For calculation purposes, an annual dividend of NOK 0.45 to NOK 0.90 were

assumed for the various programmes.

Share option costs (excluding employer’s social security contributions) of NOK 763k were

expensed in 2021 (NOK 693k in 2020).

Note

Salaries and

personnel costs

Note

10.

Share-based

remuneration

Programme

Out-

standing

31.12.2020

Issued

2021

Expired

2021

Exer-

cised in

2021

Out-

standing

31.12.2021

Fair

value when

issued

Exercise

price

)

Share price

when

issued

Date

of issue

Exercise

period

2017 730 880 - 200 000 530 880 - NOK 0.60 NOK 6.42 NOK 6.42 28.06.2017 2021

2019 260 000 - - - 260 000 NOK 1.66 NOK 10.29 NOK 10.29 17.12.2019 2023

2020 (pro-

gramme

775 000 - 20 000 - 755 000 NOK 2.07 NOK 11.32 NOK 11.46 02.07.2020 2024

2020 (pro-

gramme

375 000 - - - 375 000 NOK 2.45 NOK 13.91 NOK 13.91 23.12.2020 2024

2021 - 775 000 55 000 - 720 000 NOK 2.36 NOK 13.50 NOK 13.50 22.06.2021 2025

Total 2 140 880 775 000 275 000 530 880 2 110 000

1) The exercise price is the average share price over the 30 days prior to the date the option is granted.

2) The exercise price is set at fair value on the date the option is granted. The company works on the basis that the exercise price is the same as the

share price on the date the option is granted and that the options do not have any intrinsic value on this date.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Programme

No. of

options

Interest

rate Volatility Lifetime

2017 - 0.90% 28.9% 4 years

2019 260 000 0.99% 37.8% 4 years

2020 (programme 1) 755 000 0.28% 43.2% 4 years

2020 (programme 2) 375 000 0.54% 42.2% 4 years

2021 720 000 1.06% 41.7% 4 years

Total 2 110 000

Employee share purchase programme

In 2017, Itera introduced an annual Employee Share Purchase Programme, where employees

could purchase shares up to a market value of NOK 20,000 at a 20% discount. The pro-

gramme was repeated each year since 2017. After changes in Norwegian tax legislation in

2021 the programme was changed so that employees could purchase shares up to a market

value of NOK 30.000 at a 25% discount. In 2021, a total of 130 employees purchased a total

of 268,615 shares. The discount is recognised against the equity.

Share purchase programme for managers and key personnel

In 2021, a Share Purchase Programme was offered to the Group’s managers and key person-

nel in order to foster alignment of interests between executives and shareholders, as well

as contribute to retention of key people. The programme was in lieu of a Share Option Pro-

grammes that have been used in previous years.

Under the programme, the invitees were offered to purchase up to a dened number of shares

at a valuation discount of NOK 3.37 per share. The discount was related to a three-year lock-in

period of the shares. The Company has an option to re-purchase all or some of the shares

with the same discount in the event the shareholder terminates his or her employment in the

Group within the lock-in period. 24 key employees and executives showed their long-term

commitment by purchasing a total of 474,075 shares for a total investment of NOK 4.8 million

under this programme. The discount is recognised against the equity.

This information is available in the separate Remuneration Report available on www.itera.com.

All of the Group’s pension schemes are dened contribution schemes. The Group’s pen-

sion expense is represented by the premiums paid and is included in payroll and personnel

expenses in the Statement of Comprehensive Income. The Group’s pension schemes in

Norway comply with the Norwegian Mandatory Occupational Pension Act (OTP).

Pension cost

NOK 1 000 2021 2020

Norway 18 806 17 428

Denmark 2 047 1 626

Total 20 853 19 053

Note

11.

Executive personnel

Note

12.

Pension

Note

10.

Share-based

remuneration, cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

NOK 1000 2021 2020

Interest income 32 337

Foreign currency gains 1 770 5 526

Other nancial income 624 585

Net nancial income 2 424 6 448

Interest expense 294 393

Foreign currency losses 1 951 6 539

Other nancial expense 1 358 304

Total nancial expenses 3 602 7 236

Net foreign currency losses (181) (1 013)

NOK 1 000 2021 2020

Gross accounts receivable at 31 Dec 76 242 67 425

Provision for bad debts (150) (150)

Net accounts receivable at 31 Dec 76 092 67 275

Aging of receivables Total Not due < 30 days

30–60

days

60–90

days > 90 days

Accounts receivable 2021 76 092 63 764 8 850 2 882 559 37

Accounts receivable 2020 67 275 41 096 7 150 17 936 1 093 0

Accounts receivable by currency 2021 % 2020 %

NOK 67 684 89% 59 112 88%

SEK 0 0% 0 0%

DKK 8 153 11% 7 541 11%

UAH 255 0% 320 0%

EUR 0 0% 301 0 %

Sum 76 092 100 % 67 275 100%

Change in provisions for bad debts

Losses on accounts receivable are classied as operating expenses in the Consolidated

Income Statement. A loss of NOK 216k was recognised in 2021, NOK 115k in 2020. Maximum

credit risk is equivalent to the gure for net accounts receivable shown in the table above.

Intangible assets

Intangible assets (capitalised development costs) are primarily related to the development of

new concepts. These concepts are primarily related to contracts with xed future income.

In 2021, costs of NOK 7.7 million (NOK 5.7 million) incurred in connection with the develop-

ment of products were capitalised. Expenditure incurred in connection with development work

relates principally to the salaries and personnel costs of the employees involved in developing

the concepts.

Note

13.

Financial income

and expenses

Note

14.

Accounts receivable

Note

15.

Non-current assets

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

During 2021, Itera has capitalized NOK 17.8 million of development costs for a Cloud Center

of Excellence (CCoE), of which NOK 8 million is direct services and purchases of goods from

external suppliers. The remaining amount is linked to own staff through a global interdiscipli-

nary team that has formed the basis for a new global business unit called Cloud & Application

Services (CAS).

Cloud & Application Services (CAS, formerly HCS) was launched on January 1, 2022, where

CCoE is the backbone for direct (architecture and automation, process and security, cloud

operations, managed workloads, migration services) and indirectly related services (support,

maintenance of the application lifecycle).

With an estimated useful life of 5 years, an average of 3.6 MNOK per year must be recovered

through sales and delivery of related services.

2021

NOK 1 000

Development

costs Software Sum

Acquisition cost

Accumulated at 1 January 42 054 9 506 51 560

Additions 23 372 1 924 25 297

Disposals (5 331) (6 732) (12 063)

Accumulated at 31 December 60 095 4 698 64 794

Amortisation

Accumulated at 1 January 24 594 2 742 27 336

Amortisation for the year 7 155 991 8 146

Amortisation on disposals in the year (5 331) (188) (5 519)

Other changes - - -

Accumulated at 31 December 26 418 3 545 29 963

Book value

Book value at 1 January 17 458 6 762 24 225

Book value at 31 December 33 675 1 154 34 826

Estimated useful life 3–5 years 3–5 years

Amortisation plan linear linear

Prepaid expenses in 2021 includes a reclassication of the Group cloud based accounting

system Dynamics 365. The expenses for conguring the software was classied as an intangi-

ble asset in 2020. In accordance with IFRIC Update March 2021 MNOK 5.5 moved to prepaid

expenses in 2021 as the criteria in IAS 38 were not met. The costs have been capitalised as

the conguration and customisation services are not distinct from the SaaS agreement. The

costs are accrued over the terms of the service agreement, in total 5 years, the same time

period as the initial depreciation period for the asset.

Note

15.

Non-current assets,

cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

2020

NOK 1 000

Development

costs Software Sum

Acquisition cost

Accumulated at 1 January 81 418 2 575 83 992

Additions 5 665 6 699 12 364

Disposals (45 029) (142) (45 172)

Accumulated at 31 December 42 054 9 131 51 185

Amortisation

Accumulated at 1 January 60 360 1 769 62 128

Amortisation for the year 9 264 1 115 10 379

Amortisation on dispoals in the year (45 029) (142) (45 172)

Other changes - (372) (372)

Accumulated at 31 December 24 594 2 370 26 964

Book value

Book value at 1 January 21 058 805 21 864

Book value at 31 December 17 458 6 762 24 225

Estimated useful life 3–5 years 3–5 years

Amortisation plan linear linear

Property, plant and equipment

2021

NOK 1 000

Ofce

machinery &

equipment

Fixtures and

ttings Sum

Acquisition cost

Accumulated at 1 January 29 358 6 793 36 151

Additions 6 468 1 025 7 492

Disposals (1 051) (102) (1 153)

Translation differences - - -

Accumulated at 31 December 34 775 7 715 42 490

Depreciation

Accumulated at 1 January 17 085 3 661 20 747

Depreciation 6 593 544 7 138

Depreciation on disposals (959) (103) (1 063)

Translation differences - (62) (62)

Accumulated at 31 December 22 719 4 041 26 760

Book value

Book value at 1 January 12 273 3 131 15 404

Book value at 31 December 12 056 3 674 15 729

Estimated useful life 3 years 5–10 years

Depreciation plan linear linear

Note

15.

Non-current assets,

cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

2020

NOK 1 000

Ofce

machinery &

equipment

Fixtures and

ttings Sum

Acquisition cost

Accumulated at 1 January 31 708 11 909 43 617

Additions 4 018 624 4 642

Disposals (5 876) (2 905) (8 781)

Translation differences (492) (2 835) (3 327)

Accumulated at 31 December 29 358 6 793 36 151

Depreciation

Accumulated at 1 January 18 307 2 798 21 105

Depreciation 5 079 3 528 8 607

Depreciation on disposals (5 886) (1 959) (7 845)

Translation differences (415) (705) (1 120)

Accumulated at 31 December 17 085 3 661 20 747

Book value

Book value at 1 January 13 401 9 111 22 512

Book value at 31 December 12 273 3 131 15 403

Estimated useful life 3 years 5–10 years

Depreciation plan linear linear

The Group has leasing contracts in connection with investments in IT equipment related to its

major IT hosting contracts, ofce premises and company cars.

The Group had a liability for rent of premises and company cars totalling NOK 35.2 million at

31 December 2021.

Rental agreements Lease expiration

Ofce premises

Head ofce Oslo, Norway 30.06.2023

Bergen, Norway 30.04.2024

Bryne, Norway 30.06.2023

Copenhagen, Denmark 30.06.2031

Kiev, Ukraine 05.12.2022

Bratislava, Slovakia 16.03.2028

Company cars, Oslo, Norway 31.03.2022

Note

16.

Right-of-use assets

and lease liabilities

Note

15.

Non-current assets,

cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Incremental borrowing rate

Date

Rate

Leased ofce premises at date of incorporation of IFRS 16, Norway

01.01.2019

2.72%

Leased ofce premises at date of incorporation of IFRS 16, Denmark

01.01.2019

1.17%

Leased ofce premises at date of incorporation of IFRS 16, Ukraine

01.01.2019

4.26%

Leased ofce premises at date of incorporation of IFRS 16, Slovakia

01.01.2019

1.14%

Leased ofce premises, Slovakia

01.10.2021

0.95%

Leased ofce premises, Bergen, Norway

01.05.2021

1.76%

Leased company cars, Norway

01.04.2019

2.72%

Right-of-use assets

2021

Leased IT

equipment

Leased ofce

premises Sum

Net value at 1 January 4 883 33 380 38 263

Additions - 13 849 13 849

Disposals (544) (6 670) (7 214)

Depreciation (3 080) (10 383) (13 463)

Translation differences - (516) (516)

Net value at 31 December 1 258 29 659 30 917

2020

Leased IT

equipment

Leased ofce

premises Sum

Net value at 1 January 13 476 40 821 54 297

Additions 2 440 8 827 11 267

Disposals (1 186) - (1 186)

Depreciation (9 846) (14 229) (24 075)

Translation differences - (2 039) (516)

Net value at 31 December 4 883 33 380 38 263

Lease liabilities

2021

Future minimum lease payments are as follows

Leased IT

equipment

Leased ofce

premises Sum

Up to 1 year 860 14 795 15 655

1 to 5 years 137 14 884 15 021

Over 5 years - 5 534 5 534

Future minimum lease payments 997 35 213 36 210

Future interest up to 1 year 13 480 493

Future interest 1 to 5 years 3 467 470

Future interest over 5 years - 49 49

Discounted present value of future

minimum lease payments 982 34 217 35 199

Of which

– current liabilities 847 14 316 15 163

– non-current liabilities 134 19 902 20 036

Note

16.

Right-of-use assets

and lease liabilities,

cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

2020

Future minimum lease payments are as follows

Leased IT

equipment

Leased ofce

premises Sum

Up to 1 year 4 489 13 589 18 077

1 to 5 years 3 020 17 503 20 523

Over 5 years - 5 206 5 206

Future minimum lease payments 7 508 36 298 43 806

Future interest up to 1 year 119 323 442

Future interest 1 to 5 years 49 718 767

Discounted present value of future minimum lease

payments 7 340 35 257 42 597

Of which

– current liabilities 4 369 13 266 17 636

– non-current liabilities 2 971 21 991 24 962

The total cash outflow relating to leases was NOK 17.53 million in 2021. The Group does not

have signicant residual value guarantees related to its leases.

Sublease agreement

In 2021 the Group decided to sublease a part of the ofce premises in Kiev, Ukraine. The

sublease expires 30.11.2022.

In 2021 income from subleasing right of use assets was MNOK 2.3.

Lease receivable

Future minimum lease receivable are as follows

2021

Subleased

ofce premises

Sum

Up to 1 year

3 429

1 to 5 years

Over 5 years

Future minimum lease receivable

3 429

Future interest up to 1 year

Future interest 1 to 5 years

Discounted present value of future minimum lease receivable

3 370

Of which

- current liabilities

3 370

- non-current liabilities

Short term or low value lease agreements

The Group has other lease contracts with low value or short contract terms where the Group

has decided to not recognise lease liabilities or right-of-use assets. These leases are instead

expensed when they incur. Short term leases expensed in 2021 amounted to NOK 4.8 million.

Note

16.

Right-of-use assets

and lease liabilities,

cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Extension options

Several of the Group’s lease agreements for rent of ofce premises include a right of renewal

which may be exercised during the last period of the lease term. The Group’s potential future

lease payments not included in the lease liabilities related to extension options is MNOK 18.3

(gross) at 31 December 2021.

Variable lease payments

The Group has no variable lease payments.

Interest expense

The interest expense was MNOK 0.8 in 2021 compared to MNOK 1.0 in 2020.

NOK 1 000

Financial assets 2021 2020

Trade receivables 76 092 67 275

Cash and cash equivalents 37 457 54 399

Total 113 548 129 720

Financial liabilities 2021 2020

Long term leasing liabilities 20 036 24 962

Trade payables 18 846 23 169

Short term leasing liabilities 15 163 17 636

Total 54 045 95 808

There are no material differences between the recognised and fair value of nancial assets

and liabilities.

Note

17.

Financial assets and

nancial liabilities

Note

16.

Right-of-use assets

and lease liabilities,

cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

NOK 1 000 2021 2020

Tax expense

Tax payable 13 471 15 430

Change in deferred tax (20) (2 135)

Correction of previous years - -

Tax credit (175) (142)

Total tax expense 13 276 13 152

Tax payable in the balance sheet:

Prot before tax 57 424 61 786

Permanent tax differences (963) 2 358

Changes in temporary differences 2 924 4 730

Tax losses carried forward (190) -

Group contribution - -

Total basis for tax payable 59 194 68 874

Tax payable Dec. 31 12 166 14 785

Tax paid in advance (129) (276)

Correction of previous years 184 227

SkatteFUNN (4 767) (1 861)

Deduction of tax paid in Slovakia (175) (142)

Net tax payable Dec. 31 7 278 12 733

Taxes paid in advance is included in other current receivables.

Specication of the basis for deferred tax 2021 2020

Fixed assets (13 867) (14 663)

Current assets (150) (150)

Other temporary differences (236) (922)

Other accruals (1 217) (1 938)

Tax losses carried forward - (190)

Remaining tax credit (6 424) (4 630)

Total (21 893) (22 494)

Deferred tax (4 791) (4 916)

Deferred tax recognised in the balance sheet (4 791) (4 916)

NOK 1 000

2021

2020

Reconciliation of tax rate

Prot before tax

57 424

61 785

Tax calculated at the nominal corporation tax rate of 22%

12 633

13 593

Effect of change in the tax rate

Effect of tax from previous year

(227)

Effect of differing tax rates for foreign subsidiaries

(39)

(27)

Effect of permanent differences

(212)

519

Effect of change in tax calculation previous years

Effect of other differences

894

(705)

Tax expense in prot and loss

13 276

13 152

Effective tax rate

(23.1%)

(21.3%)

Note

18.

Taxes

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Information on the exchange rates applied by the Itera Group in 2021.

Jan 1 Average Dec 31

SEK 1,0435 1,0019 0,9745

DKK 1,3935 1,3666 1,3432

EUR 10,3661 10,1633 9,9888

USD 8,5174 8,5904 8,82

UAH 0,3034 0,3148 0,3226

NOK 1 000 2021 2020

Cash and bank deposits 37 457 54 399

Restricted cash (10 511) (10 282)

Unrestricted cash and cash equivalents 26 946 44 117

Undrawn credit facilities 21 500 21 500

Cash reserve 48 446 65 617

Restricted cash include the employees’ tax withholdings.

The Group has a multi-currency cash-pool agreement with Danske Bank.

The overdraft facility agreement with Danske Bank has the following nancial covenant:

* NIBD / EBITDA (net interest-bearing debt ratio) shall not be more than 2.25.

This key ratio is assessed as at December 31st each year and at the latest 120 days after

year-end.

The Group had no overdraft or borrowings from Danske Bank as at 31 December 2021.

As collateral for the line of credit, the bank has a pledge on the customer receivables of the

Norwegian subsidiaries.

Refer to note 24 for Alternative Performance Measures.

Share capital

Itera ASA’s share capital on December 31st 2021 was NOK 24,655,987 made up of

82,186,624 fully paid shares each with nominal value of NOK 0.30. All shares in Itera have the

same dividend and voting rights.

Ownership structure

At the close of 2021, Itera ASA had 2,278 (2,216) shareholders. Of these 4% (4%) were for-

eign shareholders. The company’s 20 largest shareholders owned 73 % (72%) of the compa-

ny’s shares at year-end.

Holdings of own shares

Note

19.

Exchange rates

Note

20.

Cash and cash

equivalents

Note

21.

Shareholders

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

The Itera Group held 1,269,136 own shares at the start of 2021. The Group purchased

1,726,000 own shares in 2021. 1,358,130 own shares were used in connection with

share option programme and employee share purchase programme. The Itera Group held

1,637,006 own shares at the end of 2021.

Dividend

An ordinary dividend of NOK 0.25 per hare (20.5 million) based on the 2020 result was paid

in June 2021. A supplementary dividend of NOK 0.10 per share (8.2 million) was paid in

November 2021. An ordinary dividend of NOK 0.10 per share (NOK 16.4 million) is proposed

based on the 2021 result. The Board will also ask for an authorisation to pay a supplementary

dividend later in the year.

20 largest shareholders in Itera ASA at 31 December 2021 Shares %

ARNE MJØS INVEST AS* 24 863 031 30.3%

OP CAPITAL AS 4 551 083 5.5%

GIP AS 4 158 000 5.1%

EIKESTAD AS 3 350 000 4.1%

SEPTIM CONSULTING AS 2 940 000 3.6%

BOINVESTERING AS 2 686 968 3.3%

GAMST INVEST AS 2 527 867 3.1%

DnB NOR Bank ASA 2 384 125 2.9%

JØSYRA INVEST AS 2 200 000 2.7%

ITERA ASA 1 637 006 2.0%

DZ Privatbank S.A. 1 280 000 1.6%

VERDIPAPIRFONDET STOREBRAND VEKST 1 078 218 1.3%

HØGBERG 967 959 1.2%

FRAMAR INVEST AS 925 000 1.1%

AANESTAD PANAGRI AS 900 000 1.1%

ALTEA PROPERTY DEVELOPMENT AS 700 000 0.9%

GRØSLAND 630 000 0.8%

JENSEN 623 720 0.8%

NYVANG 620 921 0.8%

MORTEN JOHNSEN HOLDING AS 600 000 0.7%

Total 20 largest 59 623 898 72.5%

Other shareholders 22 562 726 27.5%

Total all issued 82 186 624 100.0%

* Arne Mjøs Invest AS holds a future contract expiring 18 March 2022 on 2,600,000 shares at an average price

of NOK 8.824 per share. The total controlling interest of Arne Mjøs is thus 27,263,031 shares (33.2%).

There were no other transactions between the Group and related parties in the period from

1January to 31 December 2021 other than those described in note 9.

Note

22.

Transactions with

related parties

Note

21.

Shareholders, cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

On 24 February 2022, Russia started a military invasion in Ukraine. Itera has around 260

employees in Ukraine, of which close to 250 normally belong to the Kyiv ofce and the rest in

Lviv, close to the Polish border. With the outbreak of the war, a large portion of our employees

moved out of the Kyiv area into less affected areas or abroad. Our employees are able to work

from anywhere, so the downtime was mostly related to a few days of relocating, after which

deliveries were restored to more than 90%.

Itera’s only assets in Ukraine are related to the ofce furniture & equipment, leasehold

improvements and personal equipment. The net book value of this was NOK 6.9 million

on 31December 2021. The assets are insured and also still intact. Consequently, it’s the

management’s assessment that these subsequent events have no impact on the nancial

statements for 2021.

In accordance with previously communicated plans, Itera discontinued its data centre opera-

tions by the end of the rst quarter of 2022. The remaining business that had not already been

migrated to the cloud was sold to Move AS. All customer and supplier contracts related to

Itera’s data centre operations were transported to Move in the transaction. Some employees

were also transferred, and some were made redundant. It’s management’s assessment that

this transaction does not impact the presentation of the nancial statements for 2021.

No other events have been identied that have any material impact on the nancial state-

ments for 2021.

In accordance with the guidelines issued by the European Securities and Markets Authority

on alternative performance measures (APMs), Itera publishes denitions for the alterna-

tive performance measures used by the company. Alternative performance measures, i.e.

performance measures not based on nancial reporting standards, provide the company’s

management, investors and other external users with additional relevant information on

the company’s operations by excluding matters that may not be indicative of the company’s

operating result or cash flow. Itera has adopted non-recurring costs, EBITDA, EBITDA margin,

EBIT, EBIT margin and equity ratio as alternative performance measures both because the

company thinks these measures will increase the level of understanding of the company’s

operational performance and because these represent performance measures that are often

used by analysts and investors and other external parties.

EBITDA is short for earnings before interest, tax, depreciation and amortisation. It is calcu-

lated as prot for the period before (i) tax expense, (ii) nancial income and expenses and (iii)

depreciation and amortisation.

EBITDA margin is calculated as EBITDA as a proportion of operating revenue.

EBIT is short for earnings before interest and tax and is calculated as prot for the period

before (i) tax expense and (ii) nancial income and expenses.

EBIT margin is calculated as EBIT as a proportion of operating revenue.

Equity ratio is calculated as total equity as a proportion of total equity and liabilities.

NIBD/EBITDA ratio is calculated as the interestbearing liabilities minus cash or cash equiva-

lents, divided by its EBITDA.

Note

23.

Subsequent events

Note

24.

Alternative perfor-

mance measures

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Contents

Itera ASA

Income statement 60

Statement of nancial position 61

Statement of cash flows 63

General information and signicant accounting principles 64

Note 1. Salaries, personnel expenses and other remuneration 66

Note 2. Pensions 66

Note 3. Share-based remuneration 66

Note 4. Non-current assets 67

Note 5. Shares insubsidiaries 68

Note 6. Additional equity information 68

Note 7. Income taxes 69

Note 8. Income from investments in subsidiaries 69

Note 9. Balances between companies in the same group,

including cash pool 69

Note 10. Restricted deposits 70

Note 11. Transactions with related parties 70

Note 12. Public taxes and duties payable 70

Note 13. Financial risk management 70

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Income statement

Itera ASA 1 January – 31 December

NOK 1 000 Note 2021 2020

Sales revenue 46 395 38 130

Operating revenue 11 46 395 38 130

Salaries and personnel expenses 1,2,3 26 017 22 154

Depreciation and amortisation 4 1 602 2 073

Other operating expenses 1 21 580 17 263

Total operating expenses 49 199 41 490

Operating prot (loss) (2 804) (3 360)

Income from investments in subsidiaries 8 46 937 53 406

Interest income from companies in the same group 112 153

Other nancial income 349 762

Interest expense to companies in the same group 210 431

Other nancial expense 404 266

Net nancial income 46 784 53 624

Prot before income tax 43 980 50 264

Income taxes 7 (22) (89)

Net prot for the year 44 002 50 353

Allocation of prot/loss:

To supplemental dividend 6 8 219 32 875

To ordinary dividend 6 16 437 20 547

To/from other equity 6 19 346 (3 069)

Total allocation 44 002 50 353

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Statement of nancial position

Itera ASA 31 December

NOK 1 000 Note 2021 2020

ASSETS

Deferred tax assets 7 328 306

Intangible assets 4 592 5 914

Property, plant and equipment 4 1 756 2 639

Investment in subsidiaries 5 116 041 115 168

Total non-current assets 118 716 124 027

Receivables from group companies 9 4 579 3 875

Other receivables 6 477 1 058

Cash and cash equivalents 9, 10 23 249 42 850

Total current assets 34 305 47 783

TOTAL ASSETS 153 021 171 810

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Statement of nancial position

Itera ASA 31 December

NOK 1 000 Note 2021 2020

EQUITY AND LIABILITIES

Share capital 6 24 656 24 656

Other paid-in capital 6 7 166 (3 981)

Own shares 6 (491) (381)

Total paid-in capital 31 331 20 294

Other equity 6 37 694 40 441

Total retained earnings 37 694 40 441

Total equity 69 025 60 735

Accounts payable 3 425 2 999

Tax payable 7 - -

Public fees payable 12 15 787 15 415

Liabilities to group companies 9 41 579 65 577

Proposed dividend 6 16 437 20 547

Other current liabilities 6 766 6 538

Total current liabilities 83 996 111 076

Total liabilities 83 996 111 076

TOTAL EQUITY AND LIABILITIES 153 021 171 810

Oslo, 28 April, 2022

The Board of Directors of Itera ASA

Morten Thorkildsen Marianne Killengreen Jan-Erik Karlsson

Chairman of the board Board member Board member

Gyrid Skalleberg Ingerø Anne Nyseter Perez Andreas Almquist

Board member Board member Board member

(Employee elected) (Employee elected)

Arne Mjøs

Chief Executive Ofcer

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Statement of cash flows

Itera ASA 1 January – 31 December

NOK 1 000 Note 2021 2020

Cash flow from operating activities

Prot before tax 43 980 50 264

Dividend and group contribution recognised but not paid 8 (46 937) (53 406)

Share option costs 154 (2 189)

Depreciation and amortisation 4 1 602 2 073

Change in accounts payable 426 (3 516)

Change in other accruals (3 346) (1 909)

Net cash flow from operating activities (4 121) (8 683)

Cash flow from investment activities

Purchases of property, plant and equipment and intangible assets 4 (988) (5 617)

Payments from group contributions and dividends from subsidiaries 53 406 51 221

Payments of liabilities to group companies (1 117) (1 702)

Payments of receivables from group companies 2 900 1 240

Net cash flow from investment activities 54 201 45 142

Cash flow from nancing activities

Net change in group cash pool (29 707) 35 201

Cash settlement of options contract (978) -

Payments for purchases of own shares 6 (23 522) (18 242)

Proceeds from sales of own shares 6 8 427 7 953

Equity settlement of options contract 3 951 -

Dividend paid (27 853) (47 963)

Net cash flow from nancing activities (69 681) (23 051)

Net change in cash and cash equivalents (19 601) (13 408)

Cash and cash equivalents as at 1 January 42 850 29 442

Cash and cash equivalents as at 31 December 23 249 42 850

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

General information

and signicant

accounting

principles

General information

The accounts for Itera ASA have been prepared in accordance with the Accounting Act of

1998 and the generally accepted accounting principles in Norway (NGAAP). In cases where

the notes for the parent company are signicantly different from the notes for the Group,

these are provided below. Reference is otherwise made to the information in the notes for the

Group.

Estimates and judgment

Preparing accounts in accordance with Norwegian Generally Accepted Accounting Principles

involves management making judgments, estimates and assumptions that influence the

accounting principles that are applied and the amounts that are reported for assets, liabilities,

revenue and costs. Actual amounts may vary from the estimated amounts. The estimates and

underlying assumptions used are evaluated continuously. Changes in accounting estimates

are recognised in the period in which the estimates are changed and in all future periods that

are affected by the changes.

Subsidiaries

Investments in subsidiaries are valued at acquisition cost less any write downs. Investments

are written down when impaired unless the impairment is regarded as temporary. Impairment

losses are reversed if the basis for the impairment loss is no longer present. Dividends, group

contributions and other distributions from subsidiaries are recognised in prot and loss on

the same date as they are recognised in the accounts of subsidiaries. If the distributions paid

by a subsidiary exceed the prot earned by the company during any given ownership period,

these are regarded as repayments of the investment and the carrying value of the investment

is reduced.

Currency

Transactions involving foreign currencies are translated into functional currency using the

exchange rates that are in effect at the time of the transactions. Gains and losses that arise

from the payment of such transactions and the translation of monetary items in foreign cur-

rencies at the rates in effect on the date of the balance sheet are recognised in the income

statement. The Company uses the Norwegian kroner (NOK) as both its functional and pres-

entation currency.

Share capital

Ordinary shares are classied as equity. Costs directly attributable to the issuance of ordinary

shares and share options are recognised as a deduction from equity, net of any tax effects.

Purchase of own shares

Where the Company purchases its own shares, the consideration paid, including any directly

attributable costs, is recognised as a change in equity. Own shares are presented as a reduc-

tion in equity, net of any tax effects. When the Company sells or reissues it own shares, the

consideration received is recognised as an increase in equity, and gains or losses arising from

such transactions are applied to retained earnings.

Intangible assets

Intangible assets are recognised on the balance sheet if it can be shown to be probable that

there will be future economic benets attributable to the assets and their cost price can be

estimated reliably. Intangible assets are carried at cost price.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Tangible xed assets

Tangible xed assets are carried at acquisition cost less accumulated depreciation and accu-

mulated impairment losses. If the fair value of a tangible xed asset is lower than its carrying

value and the impairment is not temporary, the asset is written down to fair value.

Impairment

At each balance sheet date, the Company assesses whether there are objective indications

that assets may be impaired. Assets that are individually signicant are tested for impairment

on an individual basis. The remaining assets are assessed collectively or in groups of assets

that share similar credit risk characteristics. All impairment losses are charged to prot and

loss. Impairment losses are reversed if the reversal can be objectively linked to an event that

occurs after the loss was recognised.

Pension plan

The Company has a dened contribution pension plan. The contributions are recognised as

salaries and personnel cost in the income statements as they incur.

Share-based remuneration

Employee share options at Itera give employees the right to subscribe to shares in Itera ASA

at a future point at a predetermined price (exercise right). This right is dependent on the

employee still being employed at the time of exercise. The value of share options is calculated

at grant date and expensed as a personnel cost over the vesting period. Options are normally

granted with a subscription price equal to the average share price over the thirty days prior to

the grant date. The social security tax costs associated with employees’ taxable benets are

expensed as incurred over the accrual periods on the basis of the accrual rates and values at

the balance sheet date.

Operating revenue

The parent company’s operating revenue arises from the shared services it delivers through

its Group Functions in the accounting/nance, HR, IT and communication areas. Its revenue is

based on a cost-plus model and is recognised when the services are delivered.

Financial income and expense

Financial income comprises interest income from nancial investments and group contri-

butions or dividends from subsidiaries. Group contributions and dividends are recognised in

prot and loss on the same date that they are recognised by the company from which they are

received. Financial expense comprises interest expense on borrowings.

Tax expense

Tax expense comprises both tax payable and changes in deferred tax. Tax expense is recog-

nised in the prot and loss account. Deferred tax assets and liabilities are calculated using

the liability method on a non-discounted basis and are calculated for all differences arising

between accounting values and tax values of assets and liabilities as well as for losses carried

forward. Deferred tax assets on net tax-reducing differences that have not been eliminated

and tax losses that are to be carried forward are recognised on the basis of expected future

earnings.

General

information

and signicant

accounting

principles, cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

NOK 1000

2021

2020

Salaries

21 123 17 414

Share option costs

154 31

Social security tax

3 079 3 405

Pension costs

912

836

Other personnel costs

749

468

Total salaries and personnel expenses 26 017 22 154

Average number of employees

For information on salaries and other remuneration of the executive management, see note 9

to the consolidated accounts.

Auditor

Analysis of remuneration paid to the auditor:

2021 2020

Statutory audit 241 182

Tax advice - -

Other services 4 15

Total fees paid to the auditor 245 197

Itera ASA operates a dened contribution pension scheme. The Company’s pension expense

is represented by the premiums paid, and totalled NOK 912K in 2021 (NOK 836k). The Com-

pany’s pension scheme complies with the Norwegian Mandatory Occupational Pension Act

(OTP).

Share option costs (including employer’s social security contributions) of NOK -186k were

expensed in 2021 (NOK 31k in 2020). See note 8 in the consolidated nancial statements for

further information on share-based remuneration.

Note

Salaries, personnel

expenses and other

remuneration

Note

Pensions

Note

Share-based

remuneration

Pro-

gramme

Out-

standing

31.12.

2020

Issued

2021

Expired in

2021

Exercised

2021

Out-

standing

31.12.

2021

Fair

value when

issued

Exercise

price

)

price

when

issued

Date

of issue

Exercise

period

2017 223 080 - - 223 080 - NOK 0.60 NOK 6.42 NOK 6.42 28.06.2017 2021

2020 120 000 - - - 120 000 NOK 2.07 NOK 11.32 NOK 11.46 02.07.2020 2024

2021 - 130 000 - - 130 000 NOK 2.36 NOK 13.50 NOK 13.50 22.06.2021 2025

1) The exercise price is the average share price over the 30 days prior to the date the option is granted.

2) The exercise price is set at fair value on the date the option is granted. The company works on the basis that the exercise price is the same as the share

price on the date the option is granted and that the options do not have any intrinsic value on this date.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Programme No. of share options Interest rate Volatility Lifetime

2017 - 0.90% 28.9% 4 years

2020 120 000 0.28% 43.3% 4 years

2021 130 000 1.06% 41.7% 4 years

2021

NOK 1 000

Research

and

develop-

ment

Soft-

ware

Total

intan-

gible

assets

Ofce

machin-

ery &

equip-

ment

Fixtures

and

ttings

Total

property,

plant and

equip-

ment

Total

non-

current

assets

Acquisition cost

Accumulated at 1 January 1 918 6 492 8 410 2 385 3 831 6 216 14 626

Additions - 745 745 166 77 243 988

Disposals - (5 778) (5 778) (40) - (40) (5 818)

Accumulated at 31

December 1 918 1 459 3 377 2 511 3 908 6 419 9 796

Depreciation and

amortisation

Accumulated at 1 January 1 727 773 2 500 746 2 829 3 574 6 074

Depreciation and

amortisation 192 282 474 808 320 1 128 1 602

Depreciation and amortisa-

tion on disposals - (188) (188) (40) - (40) (228)

Accumulated at 31

December 1 918 867 2 785 1 514 3 149 4 663 7 448

Book value

Book value at 1 January

191 5 719 5 910 1 639 1 002 2 641

8 551

Book value at 31 December - 592 593 997 759 1 756 2 348

Estimated useful life

3-5 years 3-5 years 3-5 years 3-5 years

Depreciation plan

linear linear linear linear

Note

Non-current assets

Note

Share-based

remuneration, cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

NOK 1 000

Registered

ofce

capital

holding

Book value

1 Jan. Change

Book value

31 Dec.

Prot/Loss

in 2021

Equity in

2021

Itera Norge AS Oslo 1 000 100% 51 054 659 51 713 18 593 31 371

Itera Offshoring Services AS Oslo 200 100% 7 500 - 7 500 9 939 9 561

Cicero Consulting AS Oslo 200 100% 16 474 - 16 474 6 728 10 232

Compendia AS Bryne 182 100% 14 394 81 14 475 6 259 9 112

Itera Sverige AB

Stockholm 100 100% - - - (34) 1 669

Itera ApS Copenhagen 1 424 100% 16 619 98 16 717 4 059 3 015

Itera Ehf Reykjavik 34 100% - 34 34 (290) (259)

Itera Consulting Group Ukraine,

LLC Kiev 7 125 100% 9 127 - 9 127 1 812 9 589

Total 115 168 872 116 041 47 066 74 290

1) Itera Sverige AB is owned through Itera Norge AS, with book value of NOK 1.3 million.

Note

Shares in

subsidiaries

NOK 1 000

capital

Own

Other

paid-in

capital

Other

equity

Total

equity

Equity at 01 January 2020 24 656 (231) (7 545) 59 816 76 696

Net income for the period - - - 50 353 50 353

Share option costs - - (2 970) - (2 970)

Employee share purchase programme - 172 5 207 - 5 379

Purchase of own shares - (478) (781) (16 983) (18 242)

Sale of own shares - 156 2 108 - 2 264

Ordinary dividend - - - (20 547) (20 547)

Supplementary dividend - - - (32 197) (32 197)

Equity at 31 December 2020 24 656 (381) (3 981) 40 441 60 735

Net income for the period - - - 44 002 44 002

Share option costs - - 154 - 154

Cash settlement of options contract - - (978) - (978)

Employee share purchase programme - 223 8 205 - 8 427

Purchase of own shares - (518) - (23 005) (23 522)

Sale of own shares - 185 3 766 - 3 951

Ordinary dividend - - - (16 437) (16 437)

Supplementary dividend - - - (7 307) (7 307)

Equity at 31 December 2021 24 656 (491) 7 166 37 695 69 025

See note 8 in the consolidated nancial statements for further information on sharebased

remuneration.

Note

Additional equity

information

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

NOK 1 000 2021 2020

Tax expense for the year

Current tax on prot for the year - -

Change in deferred tax (22) (89)

Total tax expense for the year (22) (89)

Tax payable

Prot before tax 43 980 50 264

Permanent differences (44 079) (50 671)

Change in temporary differences 646 406

Utilisation of losses carried forward (190) -

Basis for current tax, taxable revenue 357 -

Tax payable in the balance sheet - -

Specication of the basis for deferred tax

Fixed assets (1 460) (831)

Other temporary differences (30) (370)

Total temporary differences (1 491) (1 201)

Losses carried forward - (190)

Basis for deferred tax (1 491) (1 391)

Deferred tax asset (-) / Deferred tax liability (+) (328) (306)

Itera ASA has recognised the following income in its annual accounts from its investment in its

subsidiaries:

NOK 1 000

Company name Dividend

Group

contribution Total

Itera Norge AS 22 000 - 22 000

Itera Offshoring Services AS 7 900 - 7 900

Compendia AS 5 000 - 5 000

Itera Aps 4 701 - 4 701

Cicero Consulting AS 4 700 2 635 7 335

Total income from investment in subsidiaries 44 301 2 635 46 937

Receivables from Group companies

NOK 1 000

Company name 2021 2020

Itera Norge AS 2 975 2 940

Itera ApS 217 174

Cicero Consulting AS 49 42

Compendia AS 217 148

Itera Offshoring Services AS 981 571

Itera Ehf 140 -

Total 4 579 3 875

Note

Income

taxes

Note

Income

from investments

in subsidiaries

Note

Balances between

companies in the

same group,

including cash pool

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Receivables from group companies consist of group accounts receivables, receivables from

group companies relating to the group’s joint value added tax registration (see Note 12).

Liabilities to Group companies

NOK 1 000

Company name 2021 2020

Itera Norge AS 10 207 40 472

Compendia AS 11 700 7 487

Cicero Consulting AS 10 446 9 227

Itera ApS 1 766 7 460

Itera Offshoring Services AS 7 460 932

Total 41 579 65 577

Liabilities to group companies consist bank deposits held by subsidiaries in group cash pool,

payables to group companies relating to the group’s joint value added tax registration and net of

receivables in relation to group contributions and dividends.

Cash Pool

In the group’s cash pool, Itera ASA is responsible both for its own deposits/drawings and for

deposits/drawings made by the subsidiaries. The gures reported for bank deposits held by Itera

ASA in the balance sheet include deposits paid into the cash pool by the subsidiaries, which are

netted against the parent company’s drawings. The bank deposits held by the subsidiaries in the

cash pool are reported in the parent company accounts as liabilities to group companies.

Itera ASA holds NOK 23.2 million (42.9 million) in cash and bank deposits, of which NOK 0.9

million (NOK 0.9 million) is on restricted accounts for payment of payroll tax deductions.

Itera has structured internal support processes in the areas of accounting/nance, HR, inter-

nal IT, and communication as Group Functions. These functions are part of Itera ASA and work

with subsidiaries. The parent company invoices these subsidiaries on a cost-plus model. In

2021 Itera invoiced NOK 46.4 million (NOK 38.1 million) in respect of these services.

The Norwegian companies in the group are jointly registered for value added tax and other

taxes and duties, and accordingly the gures reported for public taxes and duties payable

include value added tax payable by the other Norwegian companies in the group. The total

VAT liability is included in the parent company accounts but is offset by intragroup receivables

due from subsidiaries.

The Group is exposed to various nancial risks, such as credit risk, liquidity risk, currency risk

and interest rate risk. These risks are regarded as low. The Group has established procedures

for managing these risks. The main principle is to minimise the level of nancial risk, and the

Group on this basis holds no assets or liabilities for speculative purposes. See note 6 to the

group accounts for further information on nancial risk management.

Note

10.

Restricted deposits

Note

11.

Transactions with

related parties

Note

12.

Public taxes and

duties payable

Note

13.

Financial risk

management

Note

Balances between

companies in the

same group,

including cash pool,

cont.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

The Board of Directors and the CEO have today approved the annual report and annual accounts of the

Itera ASA group and the parent company for the 2021 calendar year and as at31 December 2021 (2021

Annual Report).

We conrm that, to the best of our knowledge:

• The consolidated accounts have been prepared in accordance with the IFRS and related interpreta-

tions as approved by the EU and with the additional Norwegian disclosure requirements pursuant to

the Norwegian Accounting Act as in effect at 31 December 2021.

• The annual accounts of the parent company have been prepared in accordance with the Norwegian

Accounting Act and Norwegian Generally Accepted Accounting Principles as in effect at 31 December

2021.

• The annual report of the group and the parent company, including the statements on corporate govern-

ance and on corporate social responsibility, has been prepared in accordance with the requirements of

the Norwegian Accounting Act and Norwegian Accounting Standard No. 16 as in effect at 31 December

2021.

• The information contained in the accounts provides a true and fair view of the group’s and the parent

company’s assets, liabilities, nancial position and earnings taken as a whole at 31 December 2021.

• The annual report of the group and the parent company provides a true and fair view of:

– the developments, earnings and nancial position of the group and the parent company

– the principal risk and uncertainty factors facing the group and the parent company

Oslo, 28 April 2022

The Board of Directors and the CEO of Itera ASA

Statement by the Board

of directors and the CEO

Arne Mjøs

Chief Executive Ofcer

Jan-Erik Karlsson

Board member

Gyrid Skalleberg Ingerø

Board member

Morten Thorkildsen

Chairman of the board

Marianne Killengreen

Board member

Andreas Almquist

Board member

Anne Nyseter Perez

Board member

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

PricewaterhouseCoopers AS, Dronning Eufemias gate 71, Postboks 748 Sentrum, NO-0106 Oslo

T: 02316, org. no.: 987 009 713 MVA, www.pwc.no

Statsautoriserte revisorer, medlemmer av Den norske Revisorforening og autorisert regnskapsførerselskap

To the General Meeting of Itera ASA

Independent Auditor’s Report

Report on the Audit of the Financial Statements

Opinion

We have audited the financial statements of Itera ASA, which comprise:

• the financial statements of the parent company Itera ASA (the Company), which comprise the

statement of financial position as at 31 December 2021, the income statement and statement

of cash flows for the year then ended, and notes to the financial statements, including a

summary of significant accounting policies, and

• the consolidated financial statements of Itera ASA and its subsidiaries (the Group), which

comprise the statement of financial position as at 31 December 2021, the statement of

comprehensive income, statement of changes in equity and statement of cash flows for the

year then ended, and notes to the financial statements, including a summary of significant

accounting policies.

In our opinion

• the financial statements comply with applicable statutory requirements,

• the financial statements give a true and fair view of the financial position of the Company as at

31 December 2021, and its financial performance and its cash flows for the year then ended in

accordance with Norwegian Accounting Act and accounting standards and practices generally

accepted in Norway, and

• the financial statements give a true and fair view of the financial position of the Group as at 31

December 2021, and its financial performance and its cash flows for the year then ended in

accordance with International Financial Reporting Standards as adopted by the EU.

Our opinion is consistent with our additional report to the Audit Committee.

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our

responsibilities under those standards are further described in the Auditor’s Responsibilities for the

Audit of the Financial Statements section of our report. We are independent of the Company and the

Group as required by laws and regulations and the International Ethics Standards Board for

Accountants’ International Code of Ethics for Professional Accountants (including International

Independence Standards) (IESBA Code), and we have fulfilled our other ethical responsibilities in

accordance with these requirements. We believe that the audit evidence we have obtained is sufficient

and appropriate to provide a basis for our opinion.

To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit

Regulation (537/2014) Article 5.1 have been provided.

We have been the auditor of the Company for 4 years from the election by the general meeting of the

shareholders on 22 May 2018 for the accounting year 2018.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

2 / 5

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 Group’s business activities are largely

unchanged compared to last year. We have not identified regulatory changes, transactions or other

events that qualify as new key audit matters. Recognition of revenue contains the same characteristics

and risks as last year and consequently has been an area of focus also for the 2021 audit.

Key Audit Matters

How our audit addressed the Key Audit Matter

Recognition

of revenue

The Group’s revenue for the year ended 31

December 2021 amounted to NOK 633 062

thousand.

The majority of

the Group’s revenue is

derived from the transfer of services over

time, but some are also point in time

contracts. Revenue from subscription

contracts are recognized over the contract

period, in accordance with IFRS 15.

Revenue is the most material amoun

t in the

financial statement, and the number of

transactions and data involved in

recognizing revenue can be quite significant

and sometimes complex, making revenue

an area with an inherent risk of errors

occurring.

Refer to notes 2 and 3 to the financial

statements, and the summary of significant

accounting policies for further details, as

well as an explanation of the accounting

principles related to revenue recognition.

We obtained an understanding of the revenue recognition

process based on intervie

ws with management and

reviews of the Group’s process and policy

documentation.

We evaluated management’s application of revenue

recognition principles and whether they were in

accordance with IFRS 15. We assessed the Group’s

revenue recognition accountin

g policies by testing the

application for a sample of contracts.

We identified, assessed and tested the design and

operating effectiveness of management’s internal controls

over revenue recognition which includes change of data

in the Group’s billing syste

m to test the accuracy and

validity of revenues.

We traced a sample of sales transactions to supporting

documentation, such as contracts, to verify the accuracy,

validity and cut

-off of revenues. Based on our

understanding of the standard flow of revenue

transactions, we also performed analytical procedures to

further test the accuracy and validity of the transactions.

Our procedures included comparing booked revenues

throughout the year to receipts of payments.

We noted no significant deviations as a resu

lt of our audit

procedures.

We considered the Group’s disclosures about revenue

recognition in note 2 and 3 to the financial statements and

the summary of significant accounting policies and found

them to be appropriate.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

3 / 5

Other Information

The Board of Directors and the Managing Director (management) are responsible for the information

in the Board of Directors’ report and the other information accompanying the financial statements. The

other information comprises information in the annual report, but does not include the financial

statements and our auditor’s report thereon. Our opinion on the financial statements does not cover

the information in the Board of Directors’ report nor the other information accompanying the financial

statements.

In connection with our audit of the financial statements, our responsibility is to read the Board of

Directors’ report and the other information accompanying the financial statements. The purpose is to

consider if there is material inconsistency between the Board of Directors’ report and the other

information accompanying the financial statements and the financial statements or our knowledge

obtained in the audit, or whether the Board of Directors’ report and the other information

accompanying the financial statements otherwise appear to be materially misstated. We are required

to report if there is a material misstatement in the Board of Directors’ report or the other information

accompanying the financial statements. We have nothing to report in this regard.

Based on our knowledge obtained in the audit, it is our opinion that the Board of Directors’ report

• is consistent with the financial statements and

• contains the information required by applicable legal requirements.

Our opinion on the Board of Director’s report applies correspondingly to the statements on Corporate

Governance and Corporate Social Responsibility.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation of financial statements that give a true and fair view in

accordance with the Norwegian Accounting Act and accounting standards and practices generally

accepted in Norway, and for the preparation and true and fair view of the consolidated financial

statements of the Group in accordance with International Financial Reporting Standards as adopted

by the EU, and for such internal control as management determines 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, management is responsible for assessing the Company’s and

the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going

concern and using the going concern basis of accounting unless management either intends to

liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about 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 ISAs 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

these financial statements.

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

4 / 5

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain

professional scepticism throughout the audit. We also:

• identify and assess the risks of material misstatement of the financial statements, whether due

to fraud or error. We 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 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 management’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 Company's and 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 Company and 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 in a manner that achieves 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 the Board of Directors 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 the Audit Committee with a statement that we have complied with relevant ethical

requirements regarding independence, and to 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 the Board of Directors, 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 2021

Content CEO comment Board of Directors Our results

5 / 5

Report on Other Legal and Regulatory Requirements

Report on compliance with Regulation on European Single Electronic Format (ESEF)

Opinion

We have performed an assurance engagement to obtain reasonable assurance that the financial

statements with file name “5967007LIEEXZXFZFK03-2021-12-31-en-zip” have been prepared in

accordance with Section 5-5 of the Norwegian Securities Trading Act (Verdipapirhandelloven) and the

accompanying Regulation on European Single Electronic Format (ESEF).

In our opinion, the financial statements have been prepared, in all material respects, in accordance

with the requirements of ESEF.

Management’s Responsibilities

Management is responsible for preparing, tagging and publishing the financial statements in the single

electronic reporting format required in ESEF. This responsibility comprises an adequate process and

the internal control procedures which management determines is necessary for the preparation,

tagging and publication of the financial statements.

Auditor’s Responsibilities

For a description of the auditor’s responsibilities when performing an assurance engagement of the

ESEF reporting, see: https://revisorforeningen.no/revisjonsberetninger

Oslo, 28 April 2022

PricewaterhouseCoopers AS

Jone Bauge

State Authorised Public Accountant

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

The objective of Itera ASA (the Company) is to ensure its shareholders a competitive return in

the form of dividends and higher share price in comparison with alternative investments.

Shareholder policy

Itera endeavours to ensure shareholders a competitive return on their investment in the form

of a higher share price and dividends. The share price shall reflect the Company’s earnings

and underlying values. Open communication and equally treatment of the shareholders shall

contribute to increased shareholder values and trust among investors.

Investor information

Itera ASA was listed on the Oslo Stock Exchange (OSE) on 27 January 1999 under the ticker

code ITE, which in 2020 was changed to ITERA. The Company shall treat all shareholders

equally concerning information which may affect the market value of the shares. All informa-

tion of relevance for the share price is published via the notication system of the Oslo Stock

Exchange as well as on the Company’s website www.itera.no, to ensure such information

is made available to all stakeholders simultaneously. The quarterly reports are also made

available on Itera’s website in the form of online webcasts. The shares have been assigned

the ISIN NO 0010001118, and the Company’s organisation number at the Norwegian

Brønnøysund Register Centre is NO 980 250 547.

Share capital

Itera ASA’s share capital at 31 December 2021 was NOK 24,655,987 made up of 82,186,624

fully paid shares each with nominal value of NOK 0.30.

All shares have the same voting rights at the General Meeting.

Shareholders

As of 31 December 2021, Itera had 2 178 (2 216) shareholders. At year-end, 6% (4%) of the

Company’s shares were owned by foreign investors. The Company’s twenty largest investors

owned 73% (72%) of the Company’s shares.

Dividend

During 2021, dividends of NOK 0.35 (0.60) per share were paid, for a total of NOK 27.9 (48.0)

million.

Share price

The Itera share price opened the year at NOK 15.00 and closed at NOK 15.25, corresponding

to a change of 2%, or 4% including dividend payments in the period. The highest share price

during the year was NOK 16.50 and the lowest price was NOK 13.00. Itera had a market value

corresponding to MNOK 1,253 (1,233) million at 31 December 2021.

Share option schemes

The Company has established option programmes for key personnel. Current share option

programmes were implemented in 2017, 2019, 2020 and 2021. The 2017 programme

expired in June of 2021. There were 2,110,000 outstanding share options at year-end. Refer-

ence is also made to Note 10 to the Consolidated Financial Statements.

Major shareholders

For major shareholders, see note 21 in the consolidated accounts.

Shares and shareholders

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Revenue

EBITDA

EBIT

100

200

300

400

500

600

700

20212020201920182017

NOK million

100

120

20212020201920182017

NOK million

100

120

20212020201920182017

NOK million

Employees

EBITDA margin

EBIT margin

100

200

300

400

500

600

700

20212020201920182017

Number

20212020201920182017

Bank deposits

Cash flow

Equity ratio

20212020201920182017

NOK million

100

120

20212020201920182017

NOK million

20212020201920182017

Development 2017–2021

(after adjustment for non-recurring costs)

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Development 2019–2021

(after adjustment for non-recurring costs)

Revenue

Employees

100

150

200

2021

2020

2019

Q4Q3Q2Q1

100

200

300

400

500

600

700

2021

2020

2019

Q4Q3Q2Q1

NOK million End of period

EBITDA

EBITDA margin

2021

2020

2019

Q4Q3Q2Q1

2021

2020

2019

Q4Q3Q2Q1

NOK million %

EBIT

EBIT margin

2021

2020

2019

Q4Q3Q2Q1

2021

2020

2019

Q4Q3Q2Q1

NOK million %

ANNUAL REPORT 2021

Content CEO comment Board of Directors Our results

Arne Mjøs

CEO

Mobile +47 905 23 172

arne.mjos@itera.com

Bent Hammer

CFO

Mobile +47 982 15 497

bent.hammer@itera.com

Itera ASA

Telephone +47 23 00 76 50

Nydalsveien 28

P. O. Box 4814 Nydalen

0422 Oslo, Norway

www.itera.com

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