Quarterly Report April to June 2019: Artificial Solutions International

STOCKHOLM,Aug. 14,2019 --

April to June 2019

Order Intake increased to 22.8 MSEK (7.6) and Order Backlog to 50.7 MSEK (28.4)

Net Sales totalling 12.6 MSEK (11.4)

Gross Margin up to 60% (46%)

Adjusted EBITDA -27.7 MSEK (-23.5)

Non-recurring expenses of -2.3 MSEK,related to the reverse takeover in February

Earnings per share -2.0 SEK

January to June 2019

Order Intake increased to 39.6 MSEK (27.8) and Order Backlog to 50.7 MSEK (28.4)

Net Sales for the half 25.3 MSEK (23.8)

Gross Margin up to 55% (51%)

Adjusted EBITDA -55.3 MSEK (-44.4)

Non-recurring expenses in connection with the reverse takeover in February totalling -28.5 MSEK

Earnings per share -4.7 SEK

Events

Signed several new customers in a number of verticals including Telecommunications,Automotive,Finance & Banking,United States Government,Retail and Information Technology

Increased and extended contractual relationships with several long-standing accounts

Swisscom signed as new Partner to address the Swiss market

Positive initial response in market following launch of Teneo Fusion and Teneo Developers in previous quarter as itfacilitates business scalability

A directed share issue raised 65.7 MSEK which was closed in the quarter and registered in July 2019

CEO STATEMENT

I am pleased to report that one of our most important keyindicators to show our progress,Order Intake,has shownstrong growth this quarter. The total committed value ofcontracts signed in the quarter grew by 200% compared to thesame quarter last year. This means that Order Intake for theyear to date already is 72% of the full year 2018,and we stillhave 6 months to go. Order Backlog,the value of customerscontractual commitments yet to be taken to revenue,grewby 79%,compared to same quarter 2018. These increasesare encouraging for the future,and I believe they reflectthe growing confidence in the Teneo platform. There is ahigher concentration of longer term agreements than seenpreviously,and these focus on our more profitable Licenseand Usage Revenue streams.

I am also pleased to note the continuation of some othertrends in our business; the increasing value and percentageof Usage Revenues,more than doubling to 3.1 MSEK in thequarter and growing by 55% to 4.5 MSEK in the first half of theyear. The increasing percentage of revenues delivered throughour Partners,34% compared to 25% in the quarter last year isalso in line with our strategy.

As we transform the mix of revenue elements towards themore profitable license and usage,the overall Gross Margincontinues to increase from 51% to 55% in this half of the yearwith the quarter performance itself of 60%.

Positive progress with customers and partners

During the quarter we have continued to sign new-nameaccounts both directly and with our Partners. Further we havenew agreements with a number of new Partners and I wasparticularly pleased to be able to announce a new Partnershipwith Switzerland's leading telecoms company,Swisscom,whoplan to create advanced Conversational AI solutions for itsemployees,customers and enterprise clients.Once again,these new customers represent a crosssectionof industries,ranging from a North European Motormanufacturer to a major US Government agency and globalsoftware and services vendor. Many of these new customershave established centres of excellence and will performmuch of the implementation themselves. These centres havea broad remit with specific market expertise who are lookingto source and build solutions to roll out across the groupthemselves. I am happy about this transition as it underpinsour overall strategy of being able to deliver projects via thirdparties whilst we can focus more upon the more profitableLicense and Usage revenues.

Successful launch of Teneo Fusion

Last Quarter I reported upon the release of Teneo Fusionand I am delighted to report that this new release has beenextremely well received by our customers and prospects,ourpartners and in the extended community of developers andSystems Integrators who build out conversational solutions. Ihave seen direct evidence that the easy access to the powerof the Teneo platform is shortening sales cycles. We havecontinued to enhance Teneo Fusion,adding a number of newlanguages and building out functionality and will continue todo so.

New funding secured

A directed share issue raising a total of 65.7 MSEK beforetransaction costs was carried out in the quarter. We will usethe funds raised to cover operating deficit and provide fundingfor future growth of Artificial Solutions.I would like to take this opportunity to thank both new andolder shareholders for your continued support and I lookforward to sharing our progress with you.

This information is such that Artificial Solutions International AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication,through the agency of the contact person set out below,at 07.30 CET on August 14,2019.

Artificial Solutions International is listed on Nasdaq First North in Stockholm with short name ASAI. Erik Penser Bank is the Company's Certified Adviser (www.penser.se,tfn 08-463 83 00,e-postcertifiedadviser@penser.se).

For more information:

Lawrence Flynn,

CEO,

Artificial Solutions

Tel: +44 (0)1635-523267

Email: lawrence.flynn@artificial-solutions.com

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Earnings release Q2 - Artificial Solutions

https://news.cision.com/artificial-solutions-international-ab/i/key-figures-q2,c2665087

Key figures Q2