Management report including Q4 highlights:

• In keeping with our strict policy of conservatism when it comes to the valuation of our portfolio, we have decided to significantly adjust the valuation of several of our holdings to reflect implicit valuations of recently conducted or contemplated fundraising in the portfolio. As a result, the Q4 net result was affected by the write-down of several shareholdings amounting to approximately 13 MSEK in total. The total calculated market value of Katalysen’s portfolio was also significantly affected, primarily following valuation adjustment in one shareholding (as announced during period).
• Decisions were made during the period to reduce operational expenses (opex), expected to result in a 25%+ reduction in opex by the beginning of 2023 Q2. Furthermore, a private placement was completed after the end of the period, which will enable the company to meet cash flow requirements. (This transaction is not reflected in the financial statements of this report).
• We are now prioritising exits (partial and full) and pursuing several such projects with various partners (stock exchanges, investment banks, co-investors, etc), which, together with the above-mentioned opex savings, should enable Katalysen to become cash positive by the end of 2023.

Katalysen performed well considering the challenging market environment

2022 was especially challenging for early-stage companies as funding sources dried up and companies needed to shift their paradigm from growth at all costs to stable cash flows. We are proud to have achieved significant progress despite all encountered challenges, we have lowered our costs, have strengthened the shareholder-base and could attract new, senior talent. Moreover, several of our portfolio companies have progressed well, both with increased sales and cost reduction and many are becoming cash-flow neutral or positive. Examples of those are Skawen, Manico, Meal Makers, Näktergal, and InvitePeople. 
 

Katalysen’s portfolio proved resilient in the face of turmoil

The pandemic, war, inflation, energy crisis, rising interest rates and fears of a recession have affected our portfolio and made a revaluation of several individual shareholdings necessary. One company was particularly affected, which triggered a special announcement on December 12. However, despite uncertain times, the vast majority of our shareholdings are on a positive track with increased operational efficiency, innovative solutions, leveraging digitalization and new technology to make their products more attractive, more effective and sustainable. Based on the maturity of some of our shareholdings, we believe that our portfolio presents opportunities for realizable gains in 2023. Hence, we focus our strategy for 2023 on achieving a positive cash-flow. To reach this goal, we will prioritize exits, both full and partial. We are reorganizing to match this priority, and as a result our monthly opex will decrease from the second quarter of 2023 onwards. The realized investment gains will allow us to re-invest capital again, not only expertise. 
 

Katalysen – Strong network and a solid foundation

We are venture developers. Using better-known US terms, we act as an accelerator, sometimes as an incubator or even as a venture studio. We help companies to accelerate the growth of their business, we help them to identify an optimal strategy and to execute it efficiently, and we co-found and create companies. This is what we call venture development. Once an early-stage company is ready to scale-up we hand it over to different owners. We either sell it to institutions with expertise in scaling-up or, in some case, introduce the company on the public market. We often hear how investors are impressed by our proven concept of building a portfolio trough investing our expertise and our ability to develop startups to more mature companies. 

Our next objective is to continue to grow our portfolio. We are also investigating possible new ventures. Companies often seek partnerships with us to grow their ventures, not asking for capital but only for our expertise. This is an important signal that further validates our concept. As an investor in demand, we can invest at better terms and deliver better long-term return on investment.
 

Welcoming new strategic investors and looking forward to a strong 2023

When we completed our IPO in the spring of 2022, we targeted an exit of 30-40 MSEK during 2022. We have altered this goal due to the market conditions and instead we brought in new key investors in Katalysen with directed issues of 28MSEK following the IPO, including the most recent private placement in 2023 Q1 (communicated 2023-01-31). This allows us to avoid having to  exit portfolio investments in the current low-valuation environment. Instead we have secured funding to be able to wait for normalized markets and valuation levels. With our sharpened focus and faith in an upcoming market turn, we are looking forward to demonstrating our full potential during 2023. 

Yours Kindly,
Peter & Heiner

General KPIs:

Q4 Group [thousand SEK]

• Net sales: 291
• Profit after financial items: -19 129
• Balance sheet total: 91 966
• Solidity: 95.6%
• Earnings per share: -3.27
• Number of outstanding shares: 5 842 208

2022 Group [thousand SEK]

• Net sales: 2 645
• Profit after financial items: -31 023
• Balance sheet total: 91 966
• Solidity: 95.6%
• Earnings per share: -5.31
• Number of outstanding shares: 5 842 208

Q4 Parent [thousand SEK]

• Net sales: 291
• Profit after financial items: -17 886
• Balance sheet total: 91 009
• Solidity: 98.3%
• Earnings per share: -3.06
• Number of outstanding shares: 5 842 208

2022 Parent [thousand SEK]

• Net sales: 2 645
• Profit after financial items: -27 147
• Balance sheet total: 91 009
• Solidity: 98.3%
• Earnings per share: -4.65
• Number of outstanding shares: 5 842 208

Venture Development KPIs (last period in brackets)

• New client agreements signed during the period: 1 (0)
• Active clients at the end of the period: 13 (13)
• Total calculated market value of Katalysen’s portfolio (shares, options, and convertibles) at the end of the period: 188.5 MSEK (227.0 MSEK) Quarterly portfolio growth (shares and options) excluding new cash invested during the period: -19.3% (6.7%) Note that a majority of this correction was communicated on the 2022-12-12 (34.7MSEK), and is related to one shareholding.
• Value added to the portfolio from new shares and options obtained via non-cash investments during the period:
  0.2 MSEK (0 MSEK)

Important events during the period
 

2022-10-24: Katalysen Ventures (“Katalysen”) completed a directed share issue of 271 214 new share, raising proceeds of approximately SEK 7.6 million.
 

2022-11-04: Katalysen announced that Emil Ahlanzberg is assuming the role of Investment Manager at Katalysen Ventures. In this new role, Emil will be responsible for leading Katalysen’s venture entry and venture exit operations. The former is primarily focused on sourcing & vetting of ventures, while the latter is focused on supporting ventures in exit readiness projects.
 

2022-11-15: Katalysen released its report for the third quarter of 2022.
 

2022-12-12: Katalysen reported on a major adjustment in a shareholding’s value. As a result, an equity holding was revalued from 60.8MSEK down to 26.1MSEK.
 

2022-12-13: Katalysen announced that it will invest expertise in Varannan Vecka, the co-parenting app for conflict prevention which has recently seen very strong traction.
 

2022-12-20: Katalysen portfolio venture Skawen closed an oversubscribed share issue to enable sustainability leaps in energy recovery, this on the back of strong European growth.
 

2022-12-27: Katalysen released a flagging notification following shareholder updates. Hallmann Holding International Investment GmbH’s shareholding grew to 10.5% following final delivery of shares in the Q4 private placement.
 

Important events after the period
 

2023-01-17: The total number of shares in Katalysen Ventures increased by 28’000 to 5’870’209. This change was the result of two shareholders deciding to exercise a total of 28’000 warrants ("teckningsoptioner"). As of 2023- 01-17, a total of 165'837 warrants remain, expiring 2023-09- 30.
 

2023-01-31: Katalysen completed a directed share issue of 805’000 new shares, raising proceeds of approximately SEK 11.9 million from strategic investors.

This disclosure contains information that Katalysen Ventures AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 21-02-2023 18:30 CET.

For more information on Katalysen Ventures, please contact:
CEO Peter Almberg
Phone: +46 76 860 37 00
E-mail: contact@katalysen.com
Web: www.katalysen.com

About Katalysen Ventures AB (publ):
Katalysen Ventures is a publicly listed venture developer that advances early-stage ventures as an active partner by providing hands-on expertise, capital, experience and access to networks. Katalysen operates via its team of venture developers out of offices in Stockholm, Geneva, and San Francisco and has so far invested its expertise and capital in 26+ early-stage ventures.